Deputy Finance Minister on drop in 2004 budget revenues

The total decrease in budget revenues could reach 1.89 percent of the GDP in 2004, Senior Deputy Finance Minister of Russia Sergey Shatalov reported at a press conference today. At the same time he pointed out that the total decline in the tax burden amounted to 1.75 percent of the GDP.

He mentioned that according to the plan for tax decrease in 2004, introduced to the government, it was planned to reduce the VAT from 20 to 18 percent preserving a privileged 10-percent tax rate for a number of necessities, the abolishment of the sales tax and the simplification of VAT repayment for capital construction. However, according to Shatalov, the speeding-up of VAT repayment cannot be considered as a measure for reducing the tax burden, though it will trigger a RUR45bn (about $1.45bn) decrease in budget revenues in 2004.