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Region: Economics and Sociology

2019 year, number 2

Contribution of Economic Sectors and Their Determinants to Tax Revenues of Consolidated Budgets in Subjects of the Russian Federation

Lobachevsky National Research State University of Nizhny Novgorod, Nizhny Novgorod, Russia
Keywords: налоговые поступления, факторный анализ, отраслевая структура экономики, налоговая нагрузка, распределение налогов, tax revenues, factor analysis, sectoral structure of the economy, tax burden, tax distribution


The article studies tax revenues of the consolidated budgets in constituent entities (subjects) of the Russian Federation and their determinants. The purpose of the current research is to assess how much various economic sectors contribute to incremental tax revenue growth in the sub-federal budgets of Russian subjects and their factorial decomposition. In order to complete this goal, we develop a four-factor additive-multiplicative model of tax revenues generation in regions. Within this model, tax revenues at the sectoral level of region are determined by the sector’s share in the regional economy (structural factor), its tax burden (fiscal factor), the level of tax revenues internal absorption in the economy (inter-budgetary factor), and the size of gross regional product (factor of scale). To assess the contribution of these factors in the regions and in the country at the aggregated and disaggregated levels, we use a mixed factor analysis including proportional, logarithmic, and integral methods. The study reveals that the largest contributors to incremental tax revenue growth in the consolidated sub-federal budgets of Russian subjects have been the five largest regions, as well as import-export: manufacturing industries, joint financial activities and real estate transactions, trade and mining. Changes in tax burden and internal absorption have, on average, decreased tax revenue inflow to the budgets in the constituent entities of the Russian Federation, whereas growing GRP and altering sectoral structure increased them. The difference in the influence of these factors at the aggregated (national) and disaggregated (average regional) levels is explained by the levels of their interregional inequality. The results of the study are applicable to assessing potential tax revenues in regions, taking into account a possibility to manage their determinants.