Senators approve execution of Russian federal budget for 2024

MOSCOW. July 16 (Interfax) - The Federation Council approved the report on the execution of the Russian federal budget for 2024 at its meeting on Wednesday.

According to the document, actual budget revenue totaled 36.7 trillion rubles in 2024, exceeding the forecast by 1.6 trillion rubles. Of this total, oil and gas revenue made up 11.1 trillion rubles, 145.8 billion rubles above the forecast, and non-oil revenue made up 25.6 trillion rubles, 1.5 trillion rubles above the forecast.

The growth was largely a result of tax payments, which reached 28.7 trillion rubles and accounted for 78.2% of revenue, exceeding the plan by 3.7%. Non-tax revenue made up 18.6% of the total at 6.8 trillion rubles, 4.8% above the forecast.

The Federation Council said in the commentary accompanying the report that the growth in non-oil revenue was partly thanks to income tax payments on deposits, disposal fee indexation, increased revenue from the placement of residual budget funds, profit transfers from the Central Bank, income from crab quota auctions as well as "large one-time non-repayable grants".

It also said that oil and gas revenue had risen due to fuel price trends as well as changes to Russia's tax legislation.

The State Duma's committee on regulation has requested a detailed explanation from the Finance Ministry for the record-level revenue from liquidity control for the single treasury account, which totaled 1.1 trillion rubles in 2024, with 872.3 billion rubles allocated to the federal budget and 229.7 billion rubles to regional budgets. The committee considers it necessary to provide clearer justification for this revenue item in view of their scale.

Federal budget expenditure reached 40.180 trillion rubles in 2024, 2.9 trillion rubles above predictions. The budget deficit amounted to 3.472 trillion rubles or 1.7% of GDP. The Federation Council said in its commentary that this was funded primarily through internal borrowing, with net OFZ-bond placement at 2.5 trillion rubles.

The National Wealth Fund (NWF) had the equivalent of 11.965 trillion rubles as of January 1, 2024 and 11.880 trillion rubles on January 1, 2025.

The State Duma's budget and tax committee said in the conclusion of the document that the sources funding the budget deficit in 2024 were executed as in 2022 and 2023, in terms of volume and the external situation. "At the same time, while supply of government securities continues to exceed demand by a serious margin, the gap is narrowing due to investors' desire to secure yield even as monetary policy is softened only slightly. In the current conditions, the committee wants to underline once more the need for a balanced policy for managing the federal budget deficit, which provides conditions which allow securities to be placed without an uncontrollable increase in expenditure due to state debt servicing," it wrote.

The committee also said that lost revenue in the regions continued to grow, while the compensatory mechanism is no longer as effective as before. Tax expenditure in the consolidated budgets of Russia's federal subjects grew 3.8-fold in 2018, while the transfers sent to the regions increased only 2.1-fold. The committee said that this created an imbalance where regions lost out on revenue due to federal decisions on tax benefits without receiving adequate compensation. "Moreover, many of the benefits are established without a fixed term and without analyzing their economic effectiveness," it said in the conclusion.

Despite the overall alignment of budget execution with planned specifications, the committee emphasized the necessity of eliminating repeatedly highlighted problems relating to revenue forecasts, debt management and obligations towards the regions.