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. Last Updated: 07/27/2016

Low Revenues Could Force Budget Change

Russia could restate its budget if revenues continue to come in below expectations, Deputy Finance Minister Tatyana Golikova said Thursday, despite her boss telling the government he doubted it would need correcting.

The country's state coffers suffered a significant shortfall in the first quarter because of lower than expected oil prices.

"The first quarter has never been representative in terms of revenues. We are waiting for the results of the first five months to assess a possible budget correction in 2007," Golikova told a news conference.

Earlier Finance Minister Alexei Kudrin told a government meeting that he was confident the budget would not need amending.

"We are not worried about budget fulfillment by the end of the year. There is still an opportunity to collect all the revenues," Kudrin was quoted by news agencies as saying.

The country's fiscal revenues in the first quarter stood at 1.4 trillion rubles ($54.07 billion), 9.5 percent lower than planned, and Kudrin said the shortfall was a result of the average price for Russian oil falling to $54.1 per barrel.

The 2007 budget sees full-year revenues at 6.97 trillion rubles but the Finance Ministry forecasts revenues of 6.61 trillion due to lower oil prices. The ministry estimates the average price for Russian oil at $55 per barrel in 2007.

Kudrin added that the price for Urals was currently higher than the forecast.

The country's main sources of budget revenues are custom duties, value-added tax, mineral extraction tax and profit tax. Oil export duties and mineral extraction tax are channeled into the state stabilization fund when oil rises above $27 a barrel.

Kudrin said the new procedure of VAT tax compensation for exporters had knocked 97.5 billion rubles off fiscal revenues, a firmer ruble against the U.S. dollar another 8.8 billion rubles and lower international gas prices 7.8 billion rubles.

He said better tax collection had added 53 billion rubles to first quarter revenues.