Tax collection improves in April, and upward revisions of expenditures are likely

RUSSIA ECONOMICS - In Brief 08 May 2026 by Evgeny Gavrilenkov

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The Ministry of Finance reported that in 4M26, total federal budget revenues reached RUB11.7 trln having fallen y-o-y by 4.5%. The collected amount accounted for 29.9% of the yearly plan and was behind schedule for this period. Oil-and-gas (O&G) revenues increased in April, but the amount was not impressive, as despite higher oil prices, O&G revenues were lower than in April 2025 (by about 21.2%) – not least due to a stronger ruble and also because the effect of increased oil prices usually translates into higher budget revenues with some lag. In May, one can indeed expect increased oil and gas (O&G) revenues. So far, O&G revenues dropped in 4M26 by 38.3% y-o-y.In contrast to the O&G, non-O&G revenues increased year-over-year (y-o-y) by 10.2% in 4M26 and by 19.6% in April, possibly indicating that the economic situation improved last month. In 4M26, O&G revenues accounted for 19.6% of the total.In 4M26, the government spent almost R17.6 trln from the federal budget. This spending increased by 15.7% y-o-y, and reached 39.9% of the 2026 plan. The federal budget deficit reached nearly RUB5.9 trln, while the 2026 target assumes a deficit of 3.8 trln. The government estimated the 4M26 budget deficit at 2.5% of GDP. It is hard to believe that the government could significantly trim forthcoming monthly expenditures and stick to the yearly target, especially if O&G revenues stay higher in the next several months. However, the continuously appreciating ruble will reduce the effect of increased Urals blend prices. Nonetheless, if the domestic economic situation is really improving, then one could expect that 2026 revenues could be upwardly revised by several trillion rubles and ...