The Ministry of Finance of the Union of Soviet Socialist Republics (USSR) (russian: Министерство финансов СССР), formed on 15 March 1946, was one of the most important government offices in the

Soviet Union The Soviet Union,. officially the Union of Soviet Socialist Republics. (USSR),. was a transcontinental country that spanned much of Eurasia from 1922 to 1991. A flagship communist state, it was nominally a federal union of fifteen national ...

. Until 1946 it was known as the People's Commissariat for Finance (russian: Народный комиссариат финансов – ''Narodnyi komissariat finansov'', or "Narkomfin"). Narkomfin, at the all-Union level, was established on 6 July 1923 after the signing of the

Treaty on the Creation of the USSR hy, ԽՍՀՄ ձեւավորման մասին պայմանագիր az, SSRİ-nin formalaşması haqqında müqavilə ka, ხელშეკრულება სსრკ-ს ფორმირების შესახებ , image ...

, and was based upon the People's Commissariat for Finance of the

Russian Soviet Federative Socialist Republic The Russian Soviet Federative Socialist Republic, Russian SFSR or RSFSR ( rus, Российская Советская Федеративная Социалистическая Республика, Rossíyskaya Sovétskaya Federatívnaya Soci ...

(RSFSR) formed in 1917. The Ministry was led by the

Minister of Finance A finance minister is an executive or cabinet position in charge of one or more of government finances, economic policy and financial regulation. A finance minister's portfolio has a large variety of names around the world, such as "treasury", " ...

, prior to 1946 a Commissar, who was nominated by the

Chairman The chairperson, also chairman, chairwoman or chair, is the presiding officer of an organized group such as a board, committee, or deliberative assembly. The person holding the office, who is typically elected or appointed by members of the grou ...

of the

Council of Ministers A council is a group of people who come together to consult, deliberate, or make decisions. A council may function as a legislature, especially at a town, city or county/shire level, but most legislative bodies at the state/provincial or natio ...

and then confirmed by the

Presidium A presidium or praesidium is a council of executive officers in some political assemblies that collectively administers its business, either alongside an individual president or in place of one. Communist states In Communist states the presidi ...

of the

Supreme Soviet The Supreme Soviet (russian: Верховный Совет, Verkhovny Sovet, Supreme Council) was the common name for the legislative bodies (parliaments) of the Soviet socialist republics (SSR) in the Union of Soviet Socialist Republics (USSR) ...

. The minister was a member of the Council of Ministers. During the

Russian Civil War , date = October Revolution, 7 November 1917 – Yakut revolt, 16 June 1923{{Efn, The main phase ended on 25 October 1922. Revolt against the Bolsheviks continued Basmachi movement, in Central Asia and Tungus Republic, the Far East th ...

, and immediately afterwards, the Commissariat usually confiscated property to support government operations. Following a short period of stability after the civil war the Commissariat introduced several governmental

tax A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal entity) by a governmental organization in order to fund government spending and various public expenditures (regional, local, or n ...

es on the population. The commissariat's structure differed little from its

Tsarist Tsarist autocracy (russian: царское самодержавие, transcr. ''tsarskoye samoderzhaviye''), also called Tsarism, was a form of autocracy (later absolute monarchy) specific to the Grand Duchy of Moscow and its successor states ...

predecessor, the only notable difference was that the Soviet ministry was very centralised while the Tsarist's finance ministry was a very

decentralised Decentralization or decentralisation is the process by which the activities of an organization, particularly those regarding planning and decision making, are distributed or delegated away from a central, authoritative location or group. Conce ...

one. The Commissariat, and later the Ministry, prepared the

state budget A government budget is a document prepared by the government and/or other political entity presenting its anticipated tax revenues (Inheritance tax, income tax, corporation tax, import taxes) and proposed spending/expenditure (Healthcare, Educat ...

in a joint process with its republican and local branches. The Ministry's structure went through few changes due to the Soviet government's conservative approaches to change. Soviet leader

Mikhail Gorbachev Mikhail Sergeyevich Gorbachev (2 March 1931 – 30 August 2022) was a Soviet politician who served as the 8th and final leader of the Soviet Union from 1985 to dissolution of the Soviet Union, the country's dissolution in 1991. He served a ...

introduced several reforms during his rule which had the unintended consequence of considerably hurting the ministry's prestige.

Founding and early history

The Ministry's predecessor, the People's Commissariat for Finance of the

(RSFSR), was established by a decree of the second convocation of the

All-Russian Congress of Soviets The All-Russian Congress of Soviets evolved from 1917 to become the supreme governing body of the Russian Soviet Federative Socialist Republic from 1918 until 1936, effectively. The 1918 Constitution of the Russian SFSR mandated that Congress sha ...

on and was part of the

Sovnarkom The Councils of People's Commissars (SNK; russian: Совет народных комиссаров (СНК), ''Sovet narodnykh kommissarov''), commonly known as the ''Sovnarkom'' (Совнарком), were the highest executive authorities of ...

. The first Commissar was

Ivan Skvortsov-Stepanov Ivan Ivanovich Skvortsov-Stepanov (russian: Ива́н Ива́нович Скворцо́в-Степа́нов, 24 February 1870 – 8 October 1928) was a prominent Russian Bolshevik revolutionary and Soviet politician. Skvortsov-Stepanov was one ...

appointed in 1917. However, following the introduction of the

New Economic Policy The New Economic Policy (NEP) () was an economic policy of the Soviet Union proposed by Vladimir Lenin in 1921 as a temporary expedient. Lenin characterized the NEP in 1922 as an economic system that would include "a free market and capitalism, ...

, Narkomfin was made responsible for

Gosbank Gosbank (russian: Госбанк, Государственный банк СССР, ''Gosudarstvenny bank SSSR''—the State Bank of the USSR) was the central bank of the Soviet Union and the only bank in the entire country from 1922 to 1991. ...

, the State Bank of the RSFSR and then the

State Bank of the Soviet Union Gosbank (russian: Госбанк, Государственный банк СССР, ''Gosudarstvenny bank SSSR''—the State Bank of the USSR) was the central bank of the Soviet Union and the only bank in the entire country from 1922 to 1991. ...

. On 26 November 1921

Lenin Vladimir Ilyich Ulyanov. ( 1870 – 21 January 1924), better known as Vladimir Lenin,. was a Russian revolutionary, politician, and political theorist. He served as the first and founding head of government of Soviet Russia from 1917 to 19 ...

issued a note calling for the appointment of

Grigory Sokolnikov Grigori Yakovlevich Sokolnikov (born Hirsch Brilliant or Girsh Yankelevich Brilliant; 1888–1939) was a Russian Old Bolshevik revolutionary, economist, and Soviet politician. Early career Grigori Sokolnikov was born Girsh Yankelevich Brillia ...

to the newly established post of

People's Commissar for Finance The Ministry of Finance of the Union of Soviet Socialist Republics (USSR) (russian: Министерство финансов СССР), formed on 15 March 1946, was one of the most important government offices in the Soviet Union. Until 1946 it w ...

. Sokolnikov took control of the organisation in 1922, although his formal position was not ratified until November 1922. In 1946 the

Council of People's Commissars The Councils of People's Commissars (SNK; russian: Совет народных комиссаров (СНК), ''Sovet narodnykh kommissarov''), commonly known as the ''Sovnarkom'' (Совнарком), were the highest executive authorities of ...

was renamed the

and the People's Commissariat for Finance was renamed as the Ministry of Finance. In 1928 the

Soviet government The Government of the Soviet Union ( rus, Прави́тельство СССР, p=prɐˈvʲitʲɪlʲstvə ɛs ɛs ɛs ˈɛr, r=Pravítelstvo SSSR, lang=no), formally the All-Union Government of the Union of Soviet Socialist Republics, commonly ab ...

launched a building program headed by the

OSA group The OSA Group (Organization of Contemporary Architects) was an architectural association in the Soviet Union, which was active from 1925 to 1930 and considered the first group of constructivist architects. It published the journal ''SA'' (''Sovre ...

. The OSA group oversaw the construction of a building which should have housed the employees of the People's Commissariat for Finance. Due to its close connections with the Commissariat for Finance the building was often referred to as "the

Narkomfin building The Narkomfin Building is a block of flats at 25, Novinsky Boulevard, in the Central district of Moscow, Russia. Conceived as a "transitional type of experimental house", it is a renowned example of Constructivist architecture and avant-garde ho ...

". The building was designed by

Moisei Ginzburg Moisei Yakovlevich Ginzburg ( be, Майсей Якаўлевіч Гінзбург, russian: Моисей Яковлевич Гинзбург; , Minsk – 7 January 1946, Moscow) was a Soviet constructivist architect, best known for his 1929 ...

and Ignati Milinis and has a reputation for being one of the best examples of still-standing Soviet

constructivist architecture Constructivist architecture was a constructivist style of modern architecture that flourished in the Soviet Union in the 1920s and early 1930s. Abstract and austere, the movement aimed to reflect modern industrial society and urban space, while ...

. The architects tried to give the building a

collective A collective is a group of entities that share or are motivated by at least one common issue or interest, or work together to achieve a common objective. Collectives can differ from cooperatives in that they are not necessarily focused upon an ...

feel to it but, when the building was finished in 1932, it was denounced as a remnant of "leftist utopianism" by

Joseph Stalin Joseph Vissarionovich Stalin (born Ioseb Besarionis dze Jughashvili; – 5 March 1953) was a Georgian revolutionary and Soviet political leader who led the Soviet Union from 1924 until his death in 1953. He held power as General Secreta ...

's regime. Unlike many other Soviet constructivist buildings there is an ongoing campaign to save it. When

Alexei Kosygin Alexei Nikolayevich Kosygin ( rus, Алексе́й Никола́евич Косы́гин, p=ɐlʲɪkˈsʲej nʲɪkɐˈla(j)ɪvʲɪtɕ kɐˈsɨɡʲɪn; – 18 December 1980) was a Soviet statesman during the Cold War. He served as the Premi ...

, the

of the

, initiated the 1965 economic reform the Ministry of Finance sabotaged the reform by not fully implementing it which, along with many other reasons, helped the reform to fail.

Duties and responsibilities

During the formation of the Soviet state, in the late 1910s and early 1920s, the People's Commissariat for Finance of the

(RSFSR) was created. The

commissariat A commissariat is a department or organization commanded by a commissary or by a corps of commissaries. In many countries, commissary is a police rank. In those countries, a commissariat is a police station commanded by a commissary. In some ar ...

did not differ greatly from that of

Imperial Russia The Russian Empire was an empire and the final period of the List of Russian monarchs, Russian monarchy from 1721 to 1917, ruling across large parts of Eurasia. It succeeded the Tsardom of Russia following the Treaty of Nystad, which ended th ...

Ministry of Finance A ministry of finance is a part of the government in most countries that is responsible for matters related to the finance. Lists of current ministries of finance Named "Ministry" * Ministry of Finance (Afghanistan) * Ministry of Finance and Eco ...

and its system. The Soviet finance ministry was a heavily centralised structure, while its predecessor was not. During its humble beginnings, the main task of the People's Commissariat of Finance were: confiscation of property, robbery and requisition; printing and creating money; and

taxation A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal person, legal entity) by a governmental organization in order to fund government spending and various public expenditures (regiona ...

. In the immediate aftermath of the

October Revolution The October Revolution,. officially known as the Great October Socialist Revolution. in the Soviet Union, also known as the Bolshevik Revolution, was a revolution in Russia led by the Bolshevik Party of Vladimir Lenin that was a key moment ...

, and during the

, the Soviet government forcibly confiscated property to support their government. After the

inflation In economics, inflation is an increase in the general price level of goods and services in an economy. When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation corresponds to a reductio ...

of the 1920s printing of money nearly ceased and confiscation of goods became harder; after years of confiscating there was simply not enough property left to fund government operations anymore. After the civil war the confiscation of property ceased and several government

es were introduced. The ministry's tasks were summed up in the 1971 charter: "The USSR Ministry of Finance prepares the draft of the USSR State Budget and bears responsibility for the fulfilment of the USSR State Budget, both for receipts and for expenditures ... Under the rule of

the Ministry lost much of its power. An example being that before 1990 all foreign trade investments had to be approved by the Ministry of Finance but in 1990 the ministries of finance of the

Union republic The Republics of the Union of Soviet Socialist Republics or the Union Republics ( rus, Сою́зные Респу́блики, r=Soyúznye Respúbliki) were National delimitation in the Soviet Union, national-based administrative units of ...

s approved foreign investment. The ministry was of vital importance and in the 1971 charter the Soviet government gave the ministry broad

legislative A legislature is an assembly with the authority to make laws for a political entity such as a country or city. They are often contrasted with the executive and judicial powers of government. Laws enacted by legislatures are usually known as p ...

power. As nearly all organisations had some sort of financial aspects the Ministry of Finance set standards and rules for accounting and bookkeeping. It also had the power to issue regulations for the detailed application of the tax legislation. This is also a common feature in the

United States Department of Treasury The Department of the Treasury (USDT) is the national treasury and finance department of the federal government of the United States, where it serves as an executive department. The department oversees the Bureau of Engraving and Printing and th ...

, although the Soviet's regulations differ in being of a highly centralised manner that the US one does not. The Ministry of Finance usually exercised its powers jointly with other government agencies. The 1971 charter states that the Ministry of Finance had the right to participate with the State Committee on Prices for price-setting in the USSR, but it also participated in the setting of salaries and the fulfillment of the five-year plans with the State Planning Committee and the State Bank of the USSR (Gosbank). The finance ministry started the budget preparation process by preparing instructions, forms and schedules for the upcoming

and prepared a preliminary balance of revenues and expenditures using data estimated by the

State Planning Committee The State Planning Committee, commonly known as Gosplan ( rus, Госплан, , ɡosˈpɫan), was the agency responsible for central economic planning in the Soviet Union. Established in 1921 and remaining in existence until the dissolution of ...

(Gosplan). This preliminary budget was then sent, together with instructions, to the all-Union ministries and ministries of finance of the Union's republics. The Union branches of the Ministry of Finance then prepared a budget estimate with information received from the lower Union ministries and information given to them by the all-Union Ministry of Finance. The state budget was conceived after the Union Ministry negotiated a compromise with its republican and local branches and each Soviet republic was given its own state budget. The

Economic Committees of the Supreme Soviet An economy is an area of the production, distribution and trade, as well as consumption of goods and services. In general, it is defined as a social domain that emphasize the practices, discourses, and material expressions associated with the ...

voted on the state budget which, if it received enough support, would become policy.

Organisation

;Positions The leading office of the ministry was the

(titled "Commissars" until 1946), the head of the

ministry Ministry may refer to: Government * Ministry (collective executive), the complete body of government ministers under the leadership of a prime minister * Ministry (government department), a department of a government Religion * Christian ...

. The offices of First Deputy Minister of Finance were seen as the ministry's second-in-command. There were several Deputy Ministers of Finance, each of them focusing their responsibility in one specific area, for example the

financial regulation Financial regulation is a form of regulation or supervision, which subjects financial institutions to certain requirements, restrictions and guidelines, aiming to maintain the stability and integrity of the financial system. This may be handled ...

of the Soviet

automobile industry The automotive industry comprises a wide range of companies and organizations involved in the design, development, manufacturing, marketing, and selling of motor vehicles. It is one of the world's largest industries by revenue (from 16 % such ...

. ;Departments There were two departments in the Ministry of Finance, both of which were highly

centralised Centralisation or centralization (see spelling differences Despite the various English dialects spoken from country to country and within different regions of the same country, there are only slight regional variations in English orthogr ...

but were sometimes subjected to direct control by the local

CPSU Party Control Committee The Central Control Commission (russian: Центральная Контрольная Комиссия, ''Tsentral'naya Kontrol'naya Komissiya'') was a supreme disciplinary body (since 1934 within the Central Committee of the Communist Party of t ...

s. The two departments had their own distinctive

budget A budget is a calculation play, usually but not always financial, for a defined period, often one year or a month. A budget may include anticipated sales volumes and revenues, resource quantities including time, costs and expenses, environmenta ...

. The Head of the Department of Revisory Control was recommended by the Minister of Finance and approved by the

, the Head of the Department of Revisory Control for the Union republics was recommended by the republic's Minister of Finance and the Council of Ministers. The

Department of Revisory Control of the Ministry of Finance Department may refer to: * Departmentalization, division of a larger organization into parts with specific responsibility Government and military *Department (administrative division), a geographical and administrative division within a country, ...

enforced financial discipline by the following means: observance of laws, supervising financial discipline, controlling the implementation of the state budget, controlling the activities of financial organs, controlling the national insurance of the workers, examining the activities of the

State Bank A state bank is generally a financial institution that is chartered by a federated state, as opposed to one regulated at the federal or national level. State banks differ from a reserve bank in that it does not necessarily control monetary policy ...

, controlling the audit functions of the internal financial control and controlling the activities of the chief and his senior accountants. The

Department of Revisory Control of the Ministries of Finance of the Union Republics Department may refer to: * Departmentalization, division of a larger organization into parts with specific responsibility Government and military *Department (administrative division), a geographical and administrative division within a country, ...

: Controlled the implementation of the national budget of the republican Ministries of Finance and their local counterparts. The department also exercised control over enterprises and institutions directly

subordinate A hierarchy (from Greek: , from , 'president of sacred rites') is an arrangement of items (objects, names, values, categories, etc.) that are represented as being "above", "below", or "at the same level as" one another. Hierarchy is an important ...

to the Soviet government. The Department of Budget was a department which took part in drafting the budget of the

Soviet Republics The Republics of the Union of Soviet Socialist Republics or the Union Republics ( rus, Сою́зные Респу́блики, r=Soyúznye Respúbliki) were national-based administrative units of the Union of Soviet Socialist Republics ( ...

Disintegration

After the failed August Coup of 1991

Boris Yeltsin Boris Nikolayevich Yeltsin ( rus, Борис Николаевич Ельцин, p=bɐˈrʲis nʲɪkɐˈla(j)ɪvʲɪtɕ ˈjelʲtsɨn, a=Ru-Boris Nikolayevich Yeltsin.ogg; 1 February 1931 – 23 April 2007) was a Soviet and Russian politician wh ...

and the Ministry of Finance of the RSFSR claimed authority over the Ministry of Finance of the USSR, the

state bank A state bank is generally a financial institution that is chartered by a federated state, as opposed to one regulated at the federal or national level. State banks differ from a reserve bank in that it does not necessarily control monetary policy ...

and the Bank of Foreign Economic Activity. This meant that the institutions could not carry out any orders without the consent of the RSFSR government. The Ministry of Finance continued functioning until the RSFSR government issued a

decree A decree is a legal proclamation, usually issued by a head of state (such as the president of a republic or a monarch), according to certain procedures (usually established in a constitution). It has the force of law. The particular term used for ...

completing its takeover of the Soviet financial system. It was succeeded by the

of the Russian Federation (1992). The last Soviet Minister of Finance was Vladimir Yefimovich Orlov, and Vladimir Rayevsky was acting Minister during the period of transition.

Commissars and ministers

The following persons headed the Commissariat/Ministry as commissars (narkoms), ministers, and deputy ministers:

References

;Notes ;Bibliography * * {{authority control

Finance Finance is the study and discipline of money, currency and capital assets. It is related to, but not synonymous with economics, the study of production, distribution, and consumption of money, assets, goods and services (the discipline of fina ...

Finance in the Soviet Union Finance, Ministry of

Finance, Ministry of

Founding and early history

Duties and responsibilities

Organisation

Disintegration

Commissars and ministers

See also

References