At the Government session chaired by Prime Minister Askar Mamin, First Deputy Prime Minister – Minister of Finance Alikhan Smailov reported on the implementation of the state budget of the Republic of Kazakhstan for the first quarter of 2020.

Revenues of the state budget were implemented by 89.9% of the plan of the reporting period, the republican — by 78.8%, local budgets — by 121.4%. The growth rate of state budget revenues compared to the same period last year amounted to 101.2%, local budgets — 133.1%.

The republican budget revenues decreased by 10.5% (89.5%) due to the negative impact of external factors on the economy. The republican budget received revenues of 1.4 trillion tenge. The plan is not executed for 378 billion tenge. The default occurred mainly due to taxes. The following external factors affected the tax failure.

First, the spread of the coronavirus pandemic had a negative impact on the receipt of VAT and import. In particular, the reduction in imports from third countries amounts to $87 million. Due to the reduction in imports, a decrease in tax revenues from 11.4 thousand taxpayers in the amount of 49.1 billion tenge mainly for wholesale and retail trade — 6.5 thousand taxpayers , manufacturing industry — 1.3 thousand, mining industry — 130 taxpayers. In addition, during the reporting period, the number of vehicles arriving from China decreased by 29.3%.

Second, non-compliance with CIT was affected by lower prices for the main export positions: for crude oil — by 22.1%, zinc — by 20.8%, copper — by 9.4%, aluminum — by 9.7%, lead — by 10.1%, ferrochrome — by 11.6%.

Third, due to a decrease in entrepreneurial activity, the plan for VAT on TVP was not executed in the amount of 132 billion tenge.

“Despite the current economic situation, we are timely fulfilling obligations to the business. In the reporting period, they returned 193 billion tenge. The amount of VAT refunds increased by 84 billion tenge compared to the same period in 2019,” Smailov said.

In the revised republican budget adopted on April 8, the annual income plan amounted to 6.4 trillion tenge.

Own revenues of local budgets were overfulfilled by 134 billion tenge and amounted to 759 billion tenge. Overfulfillment was formed mainly due to taxes — 127 billion tenge. Revenue plans are overfulfilled in all regions.

As Smailov noted, state budget expenditures were executed by 98.7%, republican — by 99.5%, local budgets — by 97.7%.

“Republican budget expenditures amounted to 2.9 trillion tenge. The growth rate compared to the same period last year amounted to 109.8%,” Smailov said.

Local budget expenditures amounted to 1.2 trillion tenge. In the reporting period, audit activities continued. 512 auditing events were held. 249 billion tenge of budget funds were covered. Financial irregularities were revealed for 91 billion tenge.

Violations of 84 billion tenge were eliminated by restoring the supply of goods, providing services and performing work, reimbursing the budget and reflecting accounting. To improve and increase the efficiency of the audit facilities, 470 recommendations were made, of which 361 were implemented.

Cameral control covered 881 thousand public procurement procedures for a total of 5.2 trillion tenge. Violations in the amount of 250 billion tenge were prevented.

The implementation of the comprehensive privatization plan for 2016–2020 was 93.2% complete. In 2020, it is planned to sell 68 facilities. Of these, 37 are for sale. During the reporting period, 6 objects were sold for 3.2 billion tenge. Thirty-one objects have been put up for auction. Three objects are aimed at reorganization and liquidation. Twenty-eight will be put up for sale before the end of the year.

“One of the main tasks facing the Ministry of Finance is, together with the relevant state bodies, timely bringing to the final recipients the financial resources provided for in the amended budget for the social sphere and the support of entrepreneurs. During the year, we will ensure the implementation of the revised income plan without reducing their growth rate,” Smailov said.