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. Last Updated: 07/27/2016

IMF Mulls Release in May for Delayed Loans

Low Russian tax revenues are still a major barrier to big loans from the International Monetary Fund, a source familiar with talks between Russia and the IMF said Thursday.


But the IMF might decide in mid-May to release some of the hundreds of millions of dollars it has withheld this year, as a gesture of support to the new reformist cabinet, said the source, who requested anonymity.


No one was available to comment at the IMF office in Moscow.


"The tax position continues to be a major problem. ... The tax side is really pretty awful," the source said.


Russia has come under criticism for a highly inefficient tax collection system which allows widespread evasion, meaning the government is constantly short of revenue. But President Boris Yeltsin won a favorable reaction from the West by installing reformers in a cabinet reshuffle last month.


The IMF has already delayed paying several tranches of its $10 billion three-year loan to Russia and a mission will visit Moscow from April 23 to 25 for talks on the economy.


Payments are linked to Russia meeting monthly targets on the budget deficit, net currency reserves, revenues and net domestic assets -- the monetary base less net reserves.


But tax collection in the first quarter of this year was only 58 percent of budgeted levels, prompting the government to draw up plans to seek authority from parliament to sequester, or cut, spending.