At a meeting with Russian President Vladimir Putin, Vice-Premier and Finance Minister Alexei Kudrin said he was sure that it would be possible to balance the budgets of Russian Federation constituents without the sale tax to be abolished from 2005. Kudrin announced that last week a conference was held on the issue and a decision was taken to analyse the consequences the abolishing of the tax will have for Federation constituents and to work out extra measures that would insure the regions from a shortfall of revenues. (The 5% sale tax goes to regional budgets.) "We have already worked out such measures," the vice-premier said. In particular, the federal centre is supposed to transfer a part of taxes from the federal budget to Federation constituents.
At the same time, extra subsidies could be allocated to those regions, which will find it insufficient. "We have no doubts that in the future the budgets of federation constituents will be safe and balanced and will solve all tasks set to them," Kudrin said. According to him, the growth of the gross domestic product, income tax, property taxes, which yield large revenues to Federation constituents inspires such hopes.
"We should use shock therapy to sober up the Americans. In this case, the Americans will speak about the need to resume dialogue. There is no other option"
The United States is concerned about the current crisis in the relations with Russia and suggests returning to reasonable policies to avoid a nuclear war