Foreign Relations of the United States, 1948, Eastern Europe; The Soviet Union, Volume IV

861.51/2–348: Telegram

The Ambassador in the Soviet Union (Smith) to the Secretary of State

Moscow, February 3, 1948.

195. Moscow press February 1 published Finance Minister Zverev’s¹ report on USSR 1948 budget. Principal categories revenues and expenditures planned 1948, with comparison actual 1947 figures, follow in billions rubles:²

Total planned revenues 428.0 vs 385.2; total expenditures 387.9 vs 361.2. Revenues from turnover tax, 280.1 vs 239.9; direct taxes on population 31.1 vs 28.0; state loans, 22.6 vs 25.7. Expenditures on national economy, 149.0 vs 132.7; social and cultural, 116.3 vs 106.5; armed forces, 66.1 vs 66.4; administrative, 13.5 vs 13.0; debt service, 3.5 vs 6.5.

Breakdown expenses national economy: industry, 93.9 vs 83.9; agriculture, 20.0 vs 16.8; transport, 13.8 vs 12.0; trade, 4.2 vs 4.2. Social and cultural: education, 116.3 vs 106.5; health, 59.1; social insurance, 15.7; social security, 22.6.

New capital allocation planned 60.9 billion rubles, vs 1947 plan 49.2 billion. Scientific-experimental budget increased 7.3 percent.

Total member republics’ budget 87.9 vs 82.6.

Smith

1. Arseny Grigoryevich Zveryev was Minister of Finance of the Soviet Union except between February–December 1948, when he was replaced by Alexey Nikolayevich Kosygin.
2. In a preliminary analytical assessment of the 1948 budget, the Embassy pointed out in telegram 198 from Moscow on February 3 that it was “Significant that totals higher, despite new ‘full-valued’ ruble. This year, rise should not reflect inflation, but indicate higher productivity, increased tax rates or both. Also significant that excess of revenues equals 40 billion rubles.” (861.51/2–348)