EconPapers    
Economics at your fingertips  
 

Fiscal Measures to Boost the Economic Development of Russian Territories

Alexander Andryakov () and Evgeniy A. Dombrovskiy ()
Additional contact information
Evgeniy A. Dombrovskiy: Ministry of Finance of the Russian Federation, Moscow 109097, Russian Federation

Finansovyj žhurnal — Financial Journal, 2020, issue 5, 99-113

Abstract: Two possible directions of fiscal measures aimed at improving Russian territories’ economic development are discussed in the paper: one at the level of largest agglomerations and another one at the regional level. It is widely accepted that agglomerations are “engines” of economic growth. The Strategy of Spatial Development of the Russian Federation until 2025 pays special attention to the development of agglomerations. However, the latter process has not only natural limitations, but also institutional ones arising from low fiscal independence of municipalities which form agglomerations. To overcome the institutional limitations, the paper proposes a set of fiscal measures, including a redistribution of tax revenues and expenditure obligations between the center of a given agglomeration and the region that contains it. The current fiscal mechanisms of stimulating economic development of Russian regions are analyzed. A mechanism of additional stimulation for regions to develop their own revenue base is proposed; it includes the transfer of receipts of VAT levied with a reduced rate of 10 % to regions in exchange for centralization of some part of corporate income tax in the federal budget. Different scenarios of this exchange are analyzed. It is shown that centralization of the corporate income tax amount corresponding to the 1 % rate in the federal budget in exchange for the transfer of VAT levied with a rate of 10 % to regions with a compensation mechanism within the transferred amounts is neutral to the federal budget and to budgets of the regions which receive equalization grants.

Keywords: agglomerations; fiscal equalization; regions; regional income; stimulation; intergovernmental fiscal relations; intergovernmental grants; VAT; corporate income tax (search for similar items in EconPapers)
JEL-codes: H71 H72 H74 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
https://www.finjournal-nifi.ru/images/FILES/Journa ... ii/07_5_2020_v12.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fru:finjrn:200507:p:99-113

DOI: 10.31107/2075-1990-2020-5-99-113

Access Statistics for this article

Finansovyj žhurnal — Financial Journal is currently edited by Vladimir S. Nazarov

More articles in Finansovyj žhurnal — Financial Journal from Financial Research Institute, Moscow 125375, Russia Contact information at EDIRC.
Bibliographic data for series maintained by Gennady Ageev ().

 
Page updated 2023-12-06
Handle: RePEc:fru:finjrn:200507:p:99-113