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Forecasting Non-Oil and Gas Revenues in the Russian Budget

Author

Listed:
  • Matvey Finagin

    (Bank of Russia; HSE University)

  • Sergey Sheremeta

    (Bank of Russia)

Abstract

This paper examines methods for forecasting non-oil and gas revenues in Russia's budget system in order to construct a model with the smallest forecast error in conditions of the incomplete availability of the necessary data. We use mixed data, error correction, and autoregressive distributed lag models to forecast non-oil and gas revenues at different levels of aggregation: non-oil and gas revenues minus one-time receipts; cross-border and domestic duties; and eight groups of major taxes. The quality of the models is estimated using the root mean square errors of a pseudo out-of-sample forecasts on one- and three-year horizons. The forecasts of the models constructed turn out to be more accurate than the forecasts of the Ministry of Finance of Russia for most forecast periods.

Suggested Citation

  • Matvey Finagin & Sergey Sheremeta, 2024. "Forecasting Non-Oil and Gas Revenues in the Russian Budget," Russian Journal of Money and Finance, Bank of Russia, vol. 83(4), pages 76-97, December.
    • Handle: RePEc:bkr:journl:v:83:y:2024:i:4:p:76-97
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    budget revenue forecast; non-oil and gas revenues; taxes;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • E64 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Incomes Policy; Price Policy
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • E66 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General Outlook and Conditions

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