Subsidized regions are those constituent entities of the Russian Federation that receive funds from the federal budget of the Russian Federation without the need to return them free of charge. The purposes of spending subsidies are not specified in the law of the Russian Federation, therefore, the region may dispose of them at its discretion.
On the other hand, the state allocates budget funds to support local producers. Such can be any large enterprises whose significance for the whole territory of Russia is quite large. For example, mining enterprises in the Republic of Sakha (these are subsidized regions). A list of the top 20 leading regions of Russia is presented below.
Regions of Russia receiving subsidized transfers
It is most convenient to present this kind of information in the form of a table indicating the amount of received free transfers from the Budget Center.
The table shows data for 2013 on the volume of subsidies received, without breakdown into its types.
List of subsidized regions of RussiaName of the subject of the Russian Federation | Total amount of subsidies |
The Republic of Sakha (Yakutia) | 53 248113500 |
Tambov Region | 9 897685000 |
Ivanovo region | 9 093459900 |
Kabardino-Balkaria | 8 802198900 |
Republic of North Ossetia | 8 792985800 |
Rostov region | 8 595357800 |
Magadan Region | 8 380566400 |
The Republic of Ingushetia | 8 366168800 |
Kurgan region | 8 162312100 |
Chuvashia | 7 759751100 |
Kirov region | 7 726665500 |
Primorsky Krai | 7 416408700 |
Altai Republic | 7 374648900 |
Arkhangelsk region | 7 330017700 |
Penza region | 7 198034700 |
Karachay-Cherkess Republic | 6 807642500 |
Voronezh region | 6 711864900 |
Saratov region | 6 636746600 |
Mari El Republic | 6 137821900 |
Bryansk region | 5 926866700 |
The data for 2013 are disappointing - 79 out of 83 subjects of the Russian Federation were included in the list of subsidized regions of Russia. They received state subsidies for budget equalization. This happened due to many factors, among which:
- reduced subsidies to regional budgets.
- increase in the total mass of opaque subsidies aimed at adjusting the budget of the subject of the Russian Federation.
The table shows that Yakutia received the largest amount of subsidies from the federal budget. But can such a sum be called a subsidy? The answer to the question is not as obvious as we would like. The fact is that most of the funds of the Federal Center are sent to Yakutia for the development of new mineral deposits, the Russian economy on which is still heavily dependent - this is oil and gas. And of course, the construction of the East Siberia-Pacific Ocean trunk pipeline in the amount of the transfer to the republic influenced to a large extent.
Where does the money go?
The government sends subsidies to those regions in which certain state programs are implemented in accordance with decrees of the President of the Russian Federation.
They can be related to the social sphere, for example, the construction of sports facilities, as it was in Sochi (data on subsidies for 2014 will be later), or programs for the development of medicine in the region, for example, the construction of cancer centers in the northern regions of Russia.
Thinking out loud
There is another interesting feature related to the receipt of subsidies by regions. Subsidized regions are geographically remote regions and districts. The greater the distance from Moscow, the greater the amount of funds they receive. But this information cannot be confirmed in any way. Subsidized regions are those entities that receive a free transfer and have this right to it. The calculation is made when analyzing more than 200 indicators and comparing the results with standard indicators.
The distribution of funds received transfers regarding the implementation of decrees of the President of the Russian Federation is controlled by the Accounts Chamber. Moreover, the regions that have not fulfilled their obligations, with a high degree of probability for the next year, may not receive the necessary amount.
New subsidies to the Crimea and Sevastopol. Current situation
The accession of Sevastopol and Crimea to the Russian Federation took place over 2 months. back.
At the moment, the number of constituent entities of the Russian Federation is 85 units. The tax legislation of Russia and Ukraine is built on a different principle. In Russia, 90% of organizations' tax deductions (i.e., income tax) remain in the budget of the region in whose territory its activities take place. In Ukraine, such tax deductions are sent to the state treasury in full. At the same time, nothing remains for the region.
On the topic of Crimea
Everyone knows that Crimea is primarily a resort. Accordingly, its entire infrastructure is designed for vacationers. Restaurants, cafes, hotels and mini-boarding houses used to deduct taxes to the state budget of Ukraine. Now Russia needs time to change legislation and establish ways to follow it for private entrepreneurs and legal entities.
Therefore, the question of whether Crimea is a subsidized region or not is on everyone’s lips. After joining, an assessment was made of the budget security of each autonomous republic (Crimea and Sevastopol). The result was the conclusion that Crimea needs subsidies in the same way as the Caucasus region.
What will change in Crimea?
New subsidized regions are Sevastopol and Crimea. They will have to provide the necessary level of salaries for state employees (teachers, doctors, police officers, etc.). As for the security of Crimea and Sevastopol with resources (gas, electricity and water), while all this Crimea and Sevastopol receive from Ukraine. Therefore, at one time in the media there were statements by Ukraine about non-payment of bills for these goods by Russia and Crimea in particular. Agriculture was on the verge of collapse, as the fields dried up, the crop was in jeopardy. But the Russian authorities settled this issue. To date, new water towers have already been equipped in the Crimea, which can fully satisfy the needs of the entire peninsula for irrigation.
Crimea - subsidized region or not? Since the working population of Crimea will replenish the budget of the Russian Federation with its contributions, and the peninsula will become the center of Russian tourism and will flourish, it will be possible to find out only in the future. No conclusions can now be drawn regarding the development prospects of the peninsula. But we can assume this trend: large amounts will be transferred free of charge to the treasury of the autonomous republics of Crimea and Sevastopol for their development. The state will also support the regions to improve the investment climate and attract investors.
List of subsidized regions of Ukraine 2014
Recently, the Ukrainian newspaper Capital has published data on the distribution of subsidies by regions of Ukraine. Below are subsidized regions of Ukraine. The data are ascending - from the smallest to the largest.
1. Chernihiv region - 1 370 000 hryvnias.
2. Kirovograd region - 1 470 000 hryvnias.
3. Kharkiv region - about 3 200 000 hryvnias.
4. Odessa region - about 3 200 000 hryvnias.
5. Lviv region - 3 920 000 hryvnias.
6. Dnipropetrovsk region - 4,040,000 hryvnias.
7. Donetsk region - 5,090,000 hryvnias.
Of course, the list on which subsidized regions of Ukraine are presented is not complete. According to official sources, only a few regions fulfill their budget in full and do not need subsidies from Kiev.
In the end
There are problems in every state. The recent world events, unrest and the unrecognition of the adjoining Sevastopol and the
Crimean peninsula to the territory of Russia by the Ukrainian authorities to date - all these factors, albeit indirectly, still complicate the lives of ordinary citizens. Crimeans and Sevastopol residents want to work and feed their children, many of them are ordinary pensioners, they want peace in their old age. All these people, like the citizens of Russia, are largely far from politics and tend to draw conclusions only from publicly available information. But, as you know, the media of each state treats all events exclusively in their interests, therefore, the townsfolk can only reason, sitting over a cup of tea, about events of a global nature. After the accession of two autonomous regions, the Russians did not become worse.