As of June 1, 2026, local government revenues totaled KZT 6.56 trillion, reaching 99.7% of the planned target, according to the Ministry of Finance. Despite the near-full execution rate, revenues were KZT 284.7 billion lower than during the same period last year.
Tax revenues reached KZT 3.70 trillion, equivalent to 97.2% of the plan, and declined by KZT 25.6 billion year-on-year.
The largest source of local tax revenue remains personal income tax. Collections totaled KZT 1.18 trillion during the first five months of the year, up KZT 16 billion from a year earlier. Personal income tax now accounts for more than 32% of all tax revenues received by local budgets.
Corporate income tax generated KZT 802.2 billion, down KZT 85.4 billion compared with the same period in 2025.
Transfers from the national budget amounted to KZT 2.51 trillion, a decline of KZT 385.1 billion year-on-year.
On the expenditure side, local budgets were executed at 96.6% of plan, with total spending reaching KZT 6.23 trillion.
As in previous years, the largest share of spending was directed toward education, which received KZT 2.41 trillion, accounting for 38.6% of all local government expenditures.
Housing and utilities spending totaled KZT 811.3 billion, or 13% of expenditures. Transport and communications received KZT 533.9 billion (8.6%), agriculture KZT 529 billion (8.5%), and social assistance and social security KZT 283.8 billion (4.6%).
As a result, local budgets recorded a surplus of KZT 162.6 billion during the first five months of the year.
The broader picture, however, is less encouraging than the headline surplus suggests. Compared with the same period last year, local government finances have weakened as both tax revenues and transfers from the national budget declined.
The structure of regional finances has also changed very little. Personal income tax remains the dominant source of tax revenue, generating roughly 2.5 times more income than corporate income tax. This highlights how strongly local government finances depend on household incomes and labor market conditions rather than business activity.
The spending profile is equally stable. More than half of all local government expenditures continue to be concentrated in education and housing-related services.
Taken together, the data show that local budgets remain overwhelmingly social in nature, both in how revenues are generated and how resources are allocated. The key challenge for regional authorities remains the same: expanding the economic base of local economies and increasing the contribution of business activity to their own-source revenues.
This article was translated with the assistance of artificial intelligence.
Tengenomika Telegram Channel
