Citizens' Budget 2020minfin.tj/downloads/citizens' budget-en.pdf · 2020-01-02 · 3 | Citizens'...

Citizens' Budget

2020

Ministry of Finance of the Republic of Tajikistan Law of the Republic of Tajikistan "On the State Budget for 2020"

2 | Citizens' Budget of the Republic of Tajikistan for 2020

STRUCTURE OF THE STATE BUDGET

The state budget is the main source of funds, forms of formation and spending of funds of the

republican government bodies, local executive bodies of state power, self-government bodies

of settlements and villages and targeted budget funds of the Republic of Tajikistan.

The state budget is a detailed financial plan of action of the Government of the Republic of

Tajikistan for the next financial year (i.e. 12 months). The size of the state budget is limited by funds

accrued from tax and non-tax revenues, grants and loans, the sale of securities, as well as other

mandatory payments established by law.

The republican budget is form of formulation and spending of financial resources intended to

ensure the fulfillment of tasks referred to the competence of central government bodies.

Local budgets are a form of formulation and spending of financial resources intended to ensure

tasks within the powers of sub-national government bodies.

There are also expenses in the state budget that are co-financed by the republican budget and

the budgets of sub-national government bodies.

The Public Investment Program (PIP) is a combination of grants and loans from international

development partners for the implementation of socio-economic projects. In 2020, the volume

of PIP will amount to 4.524 million somoni.

Special funds are the revenues of budgetary organizations, which are obtained from the

provision of paid services.

State target funds are funds, which are formed in accordance with the legislation of the Republic

of Tajikistan via income or in the form of deductions from specific types of receipts that are used

to achieve a particular purpose.

STATE BUDGET

Republican budget

and state target

funds

Sub-national

budgets

State investments Special funds

(revenues)

50.6% 24.5% 17.4% 7.7%


BUDGET FORMULATION PROCESS

The formation of the state budget of the Republic of Tajikistan is based on the Law of the Republic

of Tajikistan "On the State Budget of the Republic of Tajikistan" in line with the Resolution of the

Government of Tajikistan, and lasts from January to December of each financial year.

Protected articles of the state budget provide critical articles of social protection of the

population with financing, regardless of changes in the state budget revenues or other shocks in

the country's economy.

Protected articles of the state budget of the Republic of Tajikistan, 2020.

MARCH

APRIL

FEBRUARY

JANUARY

MAY

JUNE

JULY

AUGUST

SEPTEMBER

NOVEMBER

DECEMBER

Development of macro-fiscal forecasts and public investment envelope

Submission of applications for new priorities & initiatives to the Ministry of Finance

Determination of government revenues and expenditures for three years

Determination of expenditure ceilings for each sector

Summing up the state budget for the previous year and the creation of a inter-

ministerial commission for the formulation of the state budget for next year

Development of sectoral instructions (Phase 1) on the formation of the state budget

Resolution of disputes on proposals for new initiatives with the Ministry of Finance

Budget hearings on sectoral expenditure ceilings

Submission and finalization of revised sectoral expenditure and revenue ceilings

for consideration by the permanent Budget Commission

Presentation of revised expenditure ceilings by sector to MABAs

Correction of macro-fiscal forecasts and public investment envelope

Submission of budget proposals by all budget organizations

Development and submission of per capita financing normatives

Revision and updating of sectoral strategic budget plans

Carrying out of budget hearings in inter-ministerial budget commission of the MoF

Preparation of the draft Law of the Republic of Tajikistan “On the state budget”

and forecast indicators of the state budget for the next two years

Publication of the draft law on the website of the Ministry of Finance

Agreement on the draft budget law with MDAs, and its submission for

consideration to the permanent Budget Commission under the Government

Consideration and adoption of the draft law on the state budget in Parliament

Adoption of the Government Resolution on measures of executing the new law

The entry into force of the new budget law

OCTOBER Consideration of the draft law on the state budget in the Government

Wages Deductions

for social

needs

Stipends

Pensions

Allowances Compensat

ion

payments

Communal

services

payments


MACROECONOMIC FORECASTS

In 2020, the gross domestic product (GDP) of the Republic of Tajikistan will amount to 87.379

million somoni, which is 11.7% more than in the previous year. It is expected that in 2021-2022

nominal GDP will grow, on average, by 11.6% per year and will amount to 108.793 million somoni

in 2022. Real GDP growth will comprise 7.9% in 2020-2021. and 8% in 2022.

According to the calculations of the Government of the Republic of Tajikistan, inflation in 2020

will reach 6.8% (i.e. prices will rise by 6.8% in the 12 months between December 2019 and

December 2020). Inflation in 2021 and 2022 will equal 6.8% and 6.6%. In addition, the somoni will

become weaker against the U.S. dollar, on average, by 6.7% in 2020 and will average 10.2 somoni

per 1 dollar. In 2020, public debt payments will amount to 1,551 million somoni (5.9% of the state

budget).

Nominal and real GDP of the Republic of Tajikistan, 2018-2022.

Growth of prices and value of somoni against U.S. dollar in the Republic of Tajikistan, 2018-2022.

4,8

5,0

5,2

5,4

5,6

5,8

6,0

6,2

0

5 000

10 000

15 000

20 000

25 000

30 000

35 000

2018 2019 2020 2021 2022

% o

f st

ate

bu

dg

et

mill

ion

so

mo

ni

Public debt servicing (in somoni) State expenditure budget (in somoni)

Public debt servicing (in % of state budget)

6,0

7,0

8,0

9,0

10,0

11,0

12,0

6,0

6,2

6,4

6,6

6,8

7,0

7,2

2018 2019 2020 2021 2022

som

on

i (p

er 1 U

.S. d

olla

r)

Infla

tio

n (

in %

to

pre

vio

us

ye

ar)

Inflation (in %) Exchange rate (somoni per 1 U.S. dollar)

6,8

7,0

7,2

7,4

7,6

7,8

8,0

8,2

0

20 000

40 000

60 000

80 000

100 000

120 000

2018 2019 2020 2021 2022

% o

f G

DP

mill

ion

so

mo

ni

Nominal GDP (in million somoni) Real GDP growth rate (in %)


REVENUES OF THE STATE BUDGET

Exemption from the following taxes: VA

T

Cu

sto

ms

du

tie

s

Pro

pe

rty t

axe

s

Tra

nsp

ort

use

rs''

ax

Tra

nsp

ort

ve

hic

les

tax

Re

ve

nu

e t

ax

Import of electricity and natural gas •

Import of equipment and special vehicles for the passenger

car park in Dushanbe of the SUE " For the production,

purchase, reservation and sale of essential goods in the city of

Dushanbe"

• •

Import of low-sulfur fuel oil for the needs of OJSC

"Teploelektrocentral" in Dushanbe • •

Construction of Ismoili Somoni Hotel on Rudaki Ave, Dushanbe • • •

Construction of 12 schools for a combined 6,050 seats and a

health care facility • •

•

Construction of avalanche tunnels in sections of the

Dushanbe-Khujand-Chanak highway • •

•

Import of 7,200 tons of coal to the Murghab district of GBAO • •

Construction of the National Theater of Tajikistan • •

Tajikistan Football Federation and local football clubs • •

Import of pedigree cattle, as well as livestock feed • •

Construction of the Yavan-Vahsh road • •

Import of passport forms by the Ministry of Foreign Affairs •

Tax revenues 17,912.0

Non-tax revenues 1,288.0

Grants (budget support) 300.0

Loans (public investment) 2,327.0

Grants (public investment) 2,196.5

Revenues of budget organizations 2,030.5

Revenues of the state budget, 2020.

6 234,4

557,8

13,3

260,7

398,9

946,9

781,0

465,8

1 196,7

300,0

Revenues of the republican budget, 2020.

Value added taxes (VAT) 6,234.4

Excise taxes 557.8

Sales tax 13.3

Tax on natural resources 260.7

Revenue tax 398.9

Income tax 946.9

Customs duties 781.0

Automobile owner tax 465.8

Other non-tax revenues 1,196.7

Grants (budget support) 300.0

Tax and customs benefits for enterprises and organizations of the Republic of Tajikistan in 2020.

17 912,0

1 288,0

300,0

2 327,0

2 196,5

2,030.5


REVENUES OF THE STATE BUDGET

Revenues of the state budget of the Republic of Tajikistan continue to grow and will amount to

26,054 million somoni in 2020. On average, revenues will grow by 9.2% per year during 2020-2022,

and the volume of grants and loans from international financial organizations will also rise. The

republican budget also includes the Reserve Fund of the President of the Republic of Tajikistan,

which will equal 384 million somoni in 2020.

The revenues of sub-national bodies include, among other things, subventions. Subventions are

allocated from the republican budget to sub-national government bodies in case of insufficient

collection of income from other sources in order to cover the need for salary expenditures over

the course of the financial year. In general, the recipients of subventions are those rayons and

oblasts that do not have sufficient funds to finance the needs of their geographical territory.

Special funds (i.e. income) of all budgetary organizations in 2020 will amount to 2,030.5 million

somoni, which is 17.2% higher than in the previous year.

State revenues of the Republic of Tajikistan in 2018-2022.

Subventions (i.e. transfers) to sub-national government bodies in 2019-2020.

0,050,0

100,0150,0200,0250,0300,0350,0400,0450,0500,0550,0

GBAO Khatlon

oblast

Varzon

(rayon)

Rasht

(rayon)

Lahsh

(rayon)

Nurobod

(rayon)

Sangvor

(rayon)

Tojikobod

(rayon)

Fayzobod

(rayon)

Shahrinav

(rayon)

mill

ion

so

mo

ni

2019 2020

1 510 1 702 2 196 1 680 1 3271 765 2 540 2 327 3 523 3 755

14 52615 258 16 078 16 078

18 500

0

2 500

5 000

7 500

10 000

12 500

15 000

17 500

20 000

22 500

25 000

2018 2019 2020 2021 2022

mill

ion

so

mo

ni

Grants Loans State revenues (total)


EXPENDITURES OF THE STATE BUDGET

The total expenditures of the state budget in 2020 will amount to 26,360.5 million somoni and will

expand by 9.3% compared with the previous year. The state budget of the Republic of Tajikistan

is social in nature and in 2020 about 44.5% of the total amount of expenditures equal to 11,730.2

million somoni will be used to finance social sectors.

In 2020, 20% of excess revenues of sub-national governments and 30% of excess revenues of the

republican budget (after covering the state budget deficit) will be directed to the Stabilization

Fund for Economic Development (SFED).

0,0 1 000,0 2 000,0 3 000,0 4 000,0 5 000,0 6 000,0

Other economic sectors

Industry and construction

Agriculture and fishery

Culture and sport

Housing and communal services

Public administration

Health care

Transport and communication

Other expenditures

Social insurance and protection

Energy

Education

million somoni

5,004.7 20.5%

3,927.6 16.1%

3,911.6 16.0%

3,128.9 12.8%

1,969.4 8.1%

1,841.3 7.5%

1,365.9 5.6%

1,230.7 5.0%

972.6 4.0%

785.5 3.2%

232.4 1.0%

70.0 0.3%

Expenditures of the state budget of the Republic of Tajikistan in 2020 (in million somoni and in %).

Change in the expenditure of the state budget of the Republic of Tajikistan in 2019-2020.

4 242 4 5241 624 1 865

18 299 19 972

0

5 000

10 000

15 000

20 000

25 000

30 000

2019 2020

mill

ion

so

mo

ni

Other expenditures of the state budget

Spending of budget organizations from special funds (own revenues)

Public investment program (PIP)



The expenditures of the republican budget in 2020 will amount to 11,495.2 million somoni, which

is 8.9% more than the previous year. To pay the salaries of budgetary organizations and institutions

funded from the republican budget, 1,922.5 million somoni is provided, which equals 16.7% of the

aggregate expenditures of the republican budget.

Other expenditures include: (1) operations with government debt obligations (1,741.6 million

somoni); (2) expenditures of Dushanbe for the implementation of the functions of the capital (25

million somoni); (3) Contingency Fund of the Government of the Republic of Tajikistan (96 million

somoni); and (4) other expenditures not classified by economic sectors (2,121.7 million somoni).

Wage bill, 1,905.0,

17%

Social payments,

251.6, 2%

Purchase of goods

and services,

2,593.1, 23%

Servicing of public

and publicly

guaranteed debt,

1,741.6, 15%

Payment of

subsidies, 94.9, 1%

Spending on

transfers, 1,209.9,

10%

Social assistance to

the population,

189.6, 2%

Other transfers,

347.7, 3%

Operations with

assets, liabilities and

investments, 3,144.4,

27%

Expenditures of the republican budget of the Republic of Tajikistan in 2020 (in million somoni).

Expenditures of the republican budget of the Republic of Tajikistan in 2020 (by sectors).

3,984.2 2,188.3 931.3

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Other expenditures Energy Public administration Education

Social insurance and protection Culture and sport Health care Transport and communication

Industry and construction Agriculture and fishery Housing and communal services Other economic sectors


PUBLIC DEBT

In 2020, 2,916.5 million somoni is provided for servicing the state debt, and the share of budget

funds in it comprises 1,741.6 million somoni.

The share of domestic debt in total public debt increased from 10.1% in 2019 to 29% in 2020, i.e.

from 221.6 million somoni to 846.7 million somoni. In general, the total amount of the state debt

of the Republic of Tajikistan will increase in 2020 compared to the previous year by 32.9%, i.e.

debt will increase by almost 1/3 in 12 months.

The main external creditors of the Government of the Republic of Tajikistan are: (1) among

international organizations - the World Bank (WB), Asian Development Bank (ADB), Islamic

Development Bank (IDB), the Eurasian Economic Union (EAEU) Anti-Crisis Fund, and the

International Monetary Fund (IMF); (2) among states - the People's Republic of China (PRC,

Eximbank), Saudi Arabia (Saudi Fund), Kuwait (Kuwait Fund), France, and Germany (KfW Bank);

and (3) Eurobonds issued by the Government of the Republic of Tajikistan in the amount of $500

million.

Change in the public debt of the Government of the Republic of Tajikistan in 2019-2020.

Payments on domestic debt, 2019-2020. Payments on external debt, 2019-2020.

1 211,7

1,281.3

761,6

788.6

0,0 500,0 1 000,0 1 500,0 2 000,0 2 500,0

2019

2020

million somoni

Principal payments Interest payments

175,3

764,0

46,3

82,7

0 200 400 600 800 1000

2019

2020

million somoni

Principal payments Interest payments

221,6846,7

1 973,2

2 069,8

0,0

500,0

1 000,0

1 500,0

2 000,0

2 500,0

3 000,0

3 500,0

2019 2020

mill

ion

so

mo

ni

Domestic debt External debt



Public administration sector in 2020 (state and republican budgets).

Executive bodies

and legislature,

220.9, 23%

Financial, tax

and budgetary

policy, 131.6,

14%

Foreign policy

activity, 254.0,

27%

Other state bodies,

335.1, 36%

413,5

213,3169,2

567,2

0,0

100,0

200,0

300,0

400,0

500,0

600,0

mill

ion

so

mo

ni

Фонд оплаты труда Капитальные расходы

Специальные средства Прочие расходы

Education and science sector in 2020 (state and republican budgets).

2 417,1

755,5896,7 935,4

0,0

500,0

1 000,0

1 500,0

2 000,0

2 500,0

3 000,0

mill

ion

so

mo

ni


Специальные средства Прочие расходы

General

secondary

education,

194.9, 21%

Professional education,

418.1, 65%

Other activity in

the area of

education, 112.9,

14%

Health care sector in 2020 (state and republican budgets).

Hospitals

148.0, 54%

Polyclinics,

6.8, 2%

Protection of health

of the population,

45.7, 16%

Other activity in

the area of

health care,

81.7, 28%

1 090,1

77,7

261,7

411,8

0,0

200,0

400,0

600,0

800,0

1 000,0

1 200,0

mill

ion

so

mo

ni

Wage bill Capital expenditures

Special funds Other expenditures

2 417,1

755,5896,7 935,4

0,0

500,0

1 000,0

1 500,0

2 000,0

2 500,0

3 000,0

mill

ion

so

mo

ni



413,5

213,3212.2

556.9

0,0

100,0

200,0

300,0

400,0

500,0

600,0

mill

ion

so

mo

ni





Social insurance and social protection of the population sector in 2020 (state and republican budgets).

Culture and sport sector in 2020 (state and republican budgets).

Housing and communal services, and environmental protection in 2020 (state and republican budgets).

66,0 21,4 155,6

3 668,6

0,0

500,0

1 000,0

1 500,0

2 000,0

2 500,0

3 000,0

3 500,0

4 000,0

mill

ion

so

mo

ni


Специальные средства Прочие расходы (вкл. пенсии)

Social

insurance of

the

population,

372.9, 67%

Social protection of

the population, 60.2,

11%

Other activity,

124.9, 22%

Activities on

physical education

and sport, 6.3, 2%Cultural-

educational

institutions, 92.9,

25%

Mass media,

144.1, 40%

Other

activity,

153.0, 33%

25,4

676,4

60,1

468,8

0

100

200

300

400

500

600

700

800

mill

ion

so

mo

ni



166,7

379,3

31,9

394,7

0

50

100

150

200

250

300

350

400

450

mill

ion

so

mo

ni



66,0 21,4155,6

3 668,6

0,0

500,0

1 000,0

1 500,0

2 000,0

2 500,0

3 000,0

3 500,0

4 000,0

mill

ion

so

mo

ni


Special funds Other expenditures (incl. pensions)

Other

activity;

17,1; 20%

Forestry;

17,8; 20%

Sanitary

activity;

12,1; 14%

Housing

and

communal

services

developm

ent; 39,9;

46%



Energy sector in 2020 (state and republican budgets).

Agriculture sector in 2020 (state and republican budgets).

Industry and construction sector in 2020 (state and republican budgets).

Cattle

breeding, … Locust

control

activities,

4.0, 12%

Development of leasing

relations and service

centers, 25.0, 73%

Anti-epizootic

measures, 2.9, 8%

32,1

105,9

3,0

91,4

0

20

40

60

80

100

120

mill

ion

so

mo

ni



55,7

566,8

25,2

137,8

0,0

100,0

200,0

300,0

400,0

500,0

600,0

mill

ion

so

mo

ni



7,3

3911,6

4,8 3,90

500

1000

1500

2000

2500

3000

3500

4000

4500

mill

ion

so

mo

ni



Other

activity;

23,0; 10%

Construct

ion; 99,1;

43%

Extractive

industry;

105,0;

45%

Productio

n; 3,7; 2%

Heating

Electricity

Other

activity



PUBLIC INVESTMENT PROGRAM

The total volume of investments in 2020 is 4,523.5 million somoni, which is 17.2% of the volume of

state budget expenditures. Of this amount, 48.6% are grants (i.e., provided to the Government

of the Republic of Tajikistan free of charge), and 51.4% are loans.

Name of investment project 2019 2020

Construction of a regional electrical power line CASA-1000 97.0 494.8

Construction of a 240 kV electrical power distribution line 257.0 292.7

Construction of the Dushanbe-Bokhtar highway (corridors 2, 5 and 6) 94.9 238.0

Rehabilitation of the Nurek hydropower station infrastructure (phase 1) 0.0 229.6

Construction of several sections of the Kulob-Kalaykhumb highway 265.8 213.8

Transport and communication sector in 2020 (state and republican budgets).

Loans and grants in the PIP of the Republic of Tajikistan in 2020 (million somoni).

1,736.4 38.4%

1,149.9 25.4%

548.9 12.1%

505.4 11.2%

375.5 8.3%

78.7 1.7%

60.9 1.3%

33.0 0.7%

28.6 0.6%

6.4 0.1%

The largest investment projects in the Republic of Tajikistan in 2020 (in million U.S. dollars).

0,0 250,0 500,0 750,0 1 000,0 1 250,0 1 500,0 1 750,0 2 000,0

Social insurance and protection

Health care

Other sectors

Culture and sport

Public administration

Education

Housing and communal services

Agriculture and fishery

Transport and communication

Energy

Grant Loan

32,5

1 427,9

44,4

464,6

0,0

200,0

400,0

600,0

800,0

1 000,0

1 200,0

1 400,0

1 600,0

mill

ion

so

mo

ni



Transport;

171,0; 88%

Communi

cations;

0,8; 0% Other

activity;

23,4; 12%


STATE BUDGET DEFICIT

The Government of the Republic of Tajikistan adheres to the principle of a balanced state

budget. This means that the amount of budget expenditures envisaged must correspond to the

amount of budget revenues. In case of expenditures exceeding revenues, there is a deficit of

the state budget.

The maximum deficit of the state budget of the Republic of Tajikistan in 2020 is set at 0.4% of gross

domestic product (GDP) or 349.5 million somoni.

Domestic sources of financing (covering) the state budget deficit.

Loans received by

the Government of

the Republic of

Tajikistan from credit

organizations in

national currency

Government bills of

the Government of

the Republic of

Tajikistan in the form

of securities in

national currency

Deposits of budget

funds in the National

Bank of Tajikistan and

other banks or credit

organizations in the

Republic of Tajikistan

Budget loans received

from the upper levels

of the state budget

system of the Republic

of Tajikistan

External sources of financing (covering) the state budget deficit.

Government securities issued by the Government

of the Republic of Tajikistan in the form of

securities in foreign currency

Loans from other states, banks, international

financial organizations and non-residents

received in foreign currency

Sources of financing (covering) the state budget deficit of the Republic of Tajikistan in 2020.

25,0

100,0

34,0

150,0

30,6

9,9

0,0

25,0

50,0

75,0

100,0

125,0

150,0

175,0

200,0

225,0

250,0

275,0

300,0

325,0

350,0

mill

ion

so

mo

ni

Exceeding of sub-national governments'

revenue plan (i.e. revenue targets)

Savings from tenders of the state procurement

of goods, works and services

Credit and grant funds of international financial

organizations

Available funds of the republican budget as of

January 1, 2020

Sale of Treasury bills

Revenues from privatization, rental of republican

property and dividends of state shares

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