Publication:
The Role of Natural Resources in Fundamental Tax Reform in the Russian Federation

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dc.contributor.authorBosquet, Benoit
dc.date.accessioned2013-07-01T20:03:42Z
dc.date.available2013-07-01T20:03:42Z
dc.date.issued2002-03
dc.description.abstractThe Russian Federation has one of the richest natural resource endowments in the world. Despite their importance in the Russian economy, natural resources do not contribute as much as they could to public revenues. Large resource rents (excess payments, or above-normal profits generated by natural resources in scarce supply) are dissipated through subsidies and wastage, or appropriated by private interests. Failure to tax this rent means that taxes must be levied elsewhere (on capital and labor) to sustain revenues, thereby depressing investment and employment, or that potential revenues are foregone. Failure to reinvest rent means that Russia perpetuates the tradition of exporting low value-added raw materials and excessive capital outflows, and retards its transition to sustainable economic development. The author provides estimates of the average and total current rent on crude oil, natural gas, and round wood in Russia. The sum of appropriated rent on oil and gas was estimated at US$9 billion in 1999 (in excess of $15 billion in 2000), or about 18 percent of consolidated tax revenues. The appropriated rent on round wood was estimated at US$191-1,032 million. A more appropriate natural resource taxation system would enhance the fiscal role of natural resources as well as create better incentives for resource conservation and environmental protection. Two conditions further reinforce the appeal of such a reform. First, the state still owns most of the natural resources, which theoretically facilitates change in resource pricing and taxation. Second, the cost of adjusting the tax system is relatively low at this time since Russian tax policy is undergoing thorough reform. Increasing rent taxation should be relatively straightforward since the system already exists. What mainly needs to be done is to differentiate the fees to reflect objective rent-generating conditions by withdrawing the rent and imposing higher taxes on profitable resource deposits. A seemingly desirable instrument-true differentiation of rental payments-does not exist in Russia despite legislative provisions that it should. Several natural resource taxes are specific taxes (set per volume), regardless of the market price or production cost. Such taxes favor profitable deposits and penalize marginal ones. The author's study should be given serious consideration in the renewed debate on tax reform and in the context of Russia's structural reform program. It is in line with the proposals of the new governmental economic strategy, particularly with boosting the share of natural resources in generating revenue and reducing income tax rates. The extra advantage to rent taxation and revenue recycling is that it would allow the government to lower the tax burden without leading to a budget deficit.en
dc.identifierhttp://documents.worldbank.org/curated/en/2002/03/1743998/role-natural-resources-fundamental-tax-reform-russian-federation
dc.identifier.doi10.1596/1813-9450-2807
dc.identifier.urihttps://hdl.handle.net/10986/14329
dc.languageEnglish
dc.language.isoen_US
dc.publisherWorld Bank, Washington, D.C.
dc.relation.ispartofseriesPolicy, Research working paper series;no. WPS 2807
dc.relation.ispartofseriesPolicy Research Working Paper;No.2807
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectNATURAL RESOURCES TAXATION
dc.subjectPUBLIC REVENUES
dc.subjectSUBSIDIES
dc.subjectWASTAGE
dc.subjectRAW MATERIALS
dc.subjectRAW MATERIAL PRICES
dc.subjectCAPITAL OUTFLOWS
dc.subjectREINVESTMENT
dc.subjectRENT TAXES
dc.subjectNATURAL RESOURCES DEVELOPMENT
dc.subjectENVIRONMENTAL PROTECTION
dc.subjectTAX REVENUES
dc.subjectTAX REFORMS
dc.subjectRESOURCES CONSERVATION
dc.subjectTAX POLICY
dc.subjectTAX BURDENS ASSETS
dc.subjectAUCTIONS
dc.subjectAVERAGE COSTS
dc.subjectAVERAGE PRODUCTION COSTS
dc.subjectBARRIERS TO ENTRY
dc.subjectCAPITAL FLIGHT
dc.subjectCOAL
dc.subjectCOMPARATIVE ADVANTAGE
dc.subjectCOMPETITIVE
dc.subjectCONSUMERS
dc.subjectCORPORATE PROFITS
dc.subjectDEPOSITS
dc.subjectDEPRECIATION
dc.subjectDISPOSABLE INCOME
dc.subjectDRINKING WATER
dc.subjectECONOMIC ACTIVITY
dc.subjectECONOMIC CONDITIONS
dc.subjectECONOMIC DEVELOPMENT
dc.subjectECONOMIC GROWTH
dc.subjectECONOMIC RENT
dc.subjectECONOMIC RENTS
dc.subjectEMPLOYMENT
dc.subjectENVIRONMENTAL PROTECTION
dc.subjectENVIRONMENTAL RESOURCES
dc.subjectENVIRONMENTAL TAXES
dc.subjectEQUALIZATION
dc.subjectEXCESS PROFITS
dc.subjectEXCHANGE RATE
dc.subjectEXCISE TAXES
dc.subjectEXPORTS
dc.subjectFISCAL FEDERALISM
dc.subjectFISH
dc.subjectFISHING
dc.subjectFOREIGN EXCHANGE
dc.subjectFOREST MANAGEMENT
dc.subjectFORESTRY
dc.subjectFUELS
dc.subjectIMPORTS
dc.subjectINCOME
dc.subjectINCOME TAXES
dc.subjectINFLATION
dc.subjectINFLATION RATES
dc.subjectLAND TAXES
dc.subjectLAND USE
dc.subjectLEGISLATION
dc.subjectLICENSES
dc.subjectLOGGING
dc.subjectMARGINAL COST
dc.subjectMARGINAL COSTS
dc.subjectMARKET PRICES
dc.subjectMARKET VALUE
dc.subjectMETALS
dc.subjectMUNICIPALITIES
dc.subjectNATIONAL BUDGETS
dc.subjectNATURAL CAPITAL
dc.subjectNATURAL RESOURCE TAXATION
dc.subjectNATURAL RESOURCE TAXES
dc.subjectNATURAL RESOURCES
dc.subjectNEGATIVE EXTERNALITIES
dc.subjectNORMAL PROFIT
dc.subjectNORMAL PROFITS
dc.subjectOIL
dc.subjectOIL PRICES
dc.subjectOIL REFINERIES
dc.subjectOIL SECTOR
dc.subjectOPPORTUNITY COST
dc.subjectPERFECT INFORMATION
dc.subjectPOLITICAL ECONOMY
dc.subjectPOLLUTION
dc.subjectPOLLUTION ABATEMENT
dc.subjectPOLLUTION CHARGES
dc.subjectPRICE INCENTIVES
dc.subjectPRODUCERS
dc.subjectPRODUCTION COSTS
dc.subjectPROFIT
dc.subjectPROFITABILITY
dc.subjectPROPERTY TAXES
dc.subjectPROVISIONS
dc.subjectPUBLIC EXPENDITURE
dc.subjectPUBLIC FINANCE
dc.subjectPUBLIC RESOURCES
dc.subjectPUBLIC REVENUES
dc.subjectRENEWABLE RESOURCES
dc.subjectRESOURCE ALLOCATION
dc.subjectRESOURCE CONSERVATION
dc.subjectRESOURCE USE
dc.subjectRETURN ON EQUITY
dc.subjectREVENUE RECYCLING
dc.subjectREVENUE SHARING
dc.subjectSTREAMS
dc.subjectTAX
dc.subjectTAX ASSESSMENT
dc.subjectTAX RATES
dc.subjectTAX REFORM
dc.subjectTAX REVENUES
dc.subjectTAXATION
dc.subjectTIMBER
dc.subjectTRADE TAXES
dc.subjectTRANSACTION COSTS
dc.subjectTRANSPORT
dc.subjectUSE
dc.subjectVALUE ADDED
dc.subjectWATER
dc.subjectWATER POLLUTION
dc.subjectWORKING CAPITAL
dc.titleThe Role of Natural Resources in Fundamental Tax Reform in the Russian Federationen
dspace.entity.typePublication
okr.crossref.titleThe Role of Natural Resources in Fundamental Tax Reform in the Russian Federation
okr.date.doiregistration2025-04-10T07:21:48.686733Z
okr.doctypePublications & Research::Policy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/2002/03/1743998/role-natural-resources-fundamental-tax-reform-russian-federation
okr.globalpracticeSocial, Urban, Rural and Resilience
okr.globalpracticeGovernance
okr.globalpracticeFinance and Markets
okr.guid330361468776750235
okr.identifier.doi10.1596/1813-9450-2807
okr.identifier.externaldocumentum000094946_02040304241092
okr.identifier.internaldocumentum1743998
okr.identifier.reportWPS2807
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2002/04/12/000094946_02040304241092/Rendered/PDF/multi0page.pdfen
okr.region.administrativeEurope and Central Asia
okr.region.countryRussian Federation
okr.sectorPublic Financial Management
okr.sectorPublic Administration, Law, and Justice
okr.topicEconomic Theory and Research
okr.topicBanks and Banking Reform
okr.topicEnvironmental Economics and Policies
okr.topicPayment Systems and Infrastructure
okr.topicPublic Sector Economics and Finance
okr.topicUrban Development::Municipal Financial Management
okr.topicFinance and Financial Sector Development
okr.unitOff of Sr VP Dev Econ/Chief Econ (DECVP)
okr.volume1
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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