28 May 2023
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Generally, revenues of 159 communities that amalgamated in the previous year have increased by five times, and their earned revenues doubled, Viacheslav Nehoda

We compared budgets of the communities before and after the amalgamation and obtained more than persuasive figures proving that the amalgamation has significant financial advantages. Those communities have already received funds and powers not only to maintain officials and keep under observation public services and amenities but to raise the level of most of the services rendered in their territory.

So said First Deputy Minister of Regional Development, Construction, and Housing and Communal Services of Ukraine Viacheslav Nehoda commenting the monitoring survey of financial capacity of 159 amalgamated territorial communities that were established in the previous year, which monitoring survey was published by the Ministry of Regional Development

"All 159 amalgamated communities in which elections were held on 25 October 2015, from the beginning of this year, have moved to direct inter-budgetary relations with the state budget. And the monitoring survey had to show how it effected the replenishment of their budgets. The indicators appeared to be very eloquent", Viacheslav Nehoda said.

In particular, according to the monitoring data, the approved amount of revenues of the general fund of local budgets of the amalgamated communities for 2016, including transfers from the state budget, totals close on UAH 4.6 billion, that is almost five times more than the adjusted local budget targets of the amalgamated communities for 2015.

Because of amendments to the tax and budget legislation in the context of decentralisation, the amount of earned revenues of local budgets of the amalgamated communities has increased by more than twice: from UAH 0.8 billion in 2015 to close on UAH 1.9 billion in 2016.

The personal income tax has become the primary source of revenues.

"All 159 amalgamated communities were established in 2015 in accordance with the law and subject to the long-term plan, consequently, they received 60 % of the personal income tax which amount in their budget targets totals more than UAH 1 billion, that is 55 % of the amount of their earned revenues", Viacheslav Nehoda said.

Next in terms of importance is, as the monitoring survey proves, the land use fee - UAH 335 million (18 % of the earned revenues), flat rate tax - UAH 242 million (13 %), excise tax - UAH 209 million (11 %).

"Also, the monitoring survey proved that the amalgamation allowed that the earned revenues of the community budgets per capita be increase. In general, the indicator increased in all 159 communities almost by UAH 800 - from UAH 596 to UAH 1,385", Viacheslav Nehoda noted.

According to the monitoring data, the Verbkivska amalgamated community in Dnipropetrovsk Oblast will receive the biggest amount of funds in per capita terms - UAH 7,257.

"The monitoring survey also proved that most money received by the amalgamated communities would be used by them not for the maintenance of officials as previously but for the projects that will improve the life of people in those territories", Viacheslav Nehoda said.

According to the monitoring survey, the largest amounts spent for officials are planned in the budget of Teterivska amalgamated community in Zhytomyr Oblast - 58%, and the smallest, in the budget of Kalynivska amalgamated community in Vinnytsia Oblast - 6%.

As it was reported, the Ministry of Regional Development published the monitoring survey of budgets of 159 amalgamated communities.

Reference information

The monitoring survey of financial capacity of the amalgamated territorial communities in which the first local elections were held on 25 October 2015 and which have direct inter-budgetary relations with the state budget in 2016 was prepared by the Ministry of Regional Development in association with the "Decentralisation Support in Ukraine" DESPRO Swiss-Ukrainian project and with the technical assistance of the "Decentralisation Support in Ukraine" Swedish-Ukrainian project.

Analytical and graphical materials are prepared on the basis of official information obtained by the Ministry of Regional Development from Oblast State Administrations.

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