Daily Memo: Russia’s Regional Budgets, US-UK Trade

Russian government revenue falls. According to a study by the HSE Center of Development Institute, revenues for Russia’s regions fell on average by 30 percent in April relative to April 2019 due to declining oil prices and the coronavirus crisis. The largest decline was in the Yamalo-Nenets Autonomous District, Astrakhan region, the Komi Republic, Tuva Republic and the Krasnodar Territory, all of which saw their revenues fall by at least 60 percent. Revenues from income taxes fell by 29 percent, from personal income taxes by almost 20 percent and from property taxes by 44 percent. This was the result of slowing business activity, a fall in salaries and rising unemployment. (In the first two weeks of June, the number of officially registered unemployed people increased by 16 percent, totaling 2.42 million people.) At the same time, however, spending in the regions increased significantly, especially on medicine, expenditures on which nearly doubled. It’s expected that after quarantine restrictions are lifted, the economy will gradually improve, but the lower income levels may continue to cause problems for the federal government. The regions will find it hard to finance not only previously planned projects but also the sectors that were hurt significantly by […]