Igor Levitin: About major results of social-economic development of transport complex in 2008 and tasks for 2009

An extended meeting of the Transport Ministry’s Collegium was held on March 13. The meeting was dedicated to the transport industry results of 2008. When summarizing the results of the industry’s social economic development in 2008, RF Transport Minister Igor Levitin noted that the transport complex has successfully dealt with the tasks in general.

Major efforts were undertaken to develop state transport policy for a long period, major strategic and program document were approved. 2 federal laws were adopted for Russia’s accession to international maritime conventions regulating ecological safety and certification of seamen.

Besides, 7 new draft laws have been elaborated and provided to the State Duma including 4 draft laws aimed at improvement of transport safety.

With direct participation of the Transport Ministry, the Council of CIS Heads of States announced cooperation in the sphere of transport to be a key line of interaction within the CIS.

Priorities have been determined for the CIS states cooperation in the sphere of transport as well as major lines of collaboration for development of the international market of motor transport services till 2020. The Ministry’s work aimed at improvement of the competitiveness of Russian international carriers enabled them to increase their share at the market to 42%. Major efforts were undertaken within the framework EurAsEC on implementation of the Conception on forming the Unite Transport Space of the EurAsEC  member-states .

The main problem is availability of bank credits. Nowadays Russian banks have considerably cut crediting of transport organizations. It is also difficult to obtain a credit now as banks have changed their approaches to determination of risk factors for transport companies in view of lower capitalization and forecasted fall of demand at the market of transport services. Thus onlyfewcompanies meet the requirements.

Besides, interest rates of up to 30% per year make loans for reequipment to be unreasonable.

This situation may have a negative effect on both quality and safety of transport services as well as on decrease in production of transport facilities by national plants.

On February 14, 2009, RF Government approved the rules for providing state guarantees on credits raised by strategic companies for key activities and capital investments. At the same time no state guarantees are envisaged for debt restructuring.

RF Ministry of Transport suggests expanding the list of purposes to obtain credits with state guarantees.

Another problem is preferential taxation (property tax and land tax) of airdromes, sea and river ports. The analysis shows a considerable impact of taxes on financial activities of business entities – airport, sea and river port operators.

Similar situation is with the land tax. Finally, absence of a decision on preferential taxation will result in further deterioration of the financial situation of the owners of transport infrastructure and in increase of tariffs and transport charges.

I ask regional authorities to make decisions on setting tax rates preventing from the increase of tax burden for owners of transport infrastructure as compared with 2008.

Besides, the Ministry of Transport proposes to simplify the procedure of VAT refund for the largest exporters of goods and services through revival of a ‘traditional exporter’ institute.

The Federal Tax Service should be entitled to refund up to 80 % of the VAT subject for recovery within one month from filing of a tax return. This measure will make it possible to cut the transport organizations’ deficiency of cash.

Taking account of the governmental decisions we have developed proposals on optimization of budget expenses keeping in mind the priorities of transport industry development.

In 2009, the federal budget priorities are: