Revenues of 159 Amalgamated Communities have Increased More than Seven Times, the Expert on the Results of Financial Decentralisation in 2016

The influx of own revenues to local budgets in Ukraine increased one and a half time in 2016 in comparison with 2015, that is by UAH 48.5 billion. It was so informed by Yanina Kaziuk, Finance Coordinator of the Central Office for Reforms at the Ministry of Regional Development.

"Plus 49.3% or UAH 48.5 billion - such was the increase of own revenues to local budgets over the year ended. In general, the own revenues of local budgets totalled UAH 147 billion. These data prove that the financial decentralisation, notwithstanding the barrage of criticism and populism, enabled the local budgets to have substantially increased, and the territories - to obtain opportunities for their development", Yanina Kaziuk commented.

She referred to the data evidencing that in 2016 the personal income tax totalled UAH 79 billion. The increase was +47%. That is by UAH 25 billion more than the revenues in 2015. The land tax increased by UAH 9 billion or by 61% and totalled UAH 23.3 billion. The flat rate tax increased by 58% and totalled UAH 17 billion.

The excise tax on the sale by retail trade business entities of excisable goods (oil products, tobacco products and beverages) is an important source of revenues to local budgets, the amount of which tax totalled UAH 11.6 billion. That amount is 52% more (+ UAH 4 billion) than in the previous year.

"Still more dynamic trend of increasing own resources of the local budgets is seen in the amalgamated territorial communities. In the last year, there were 159 such communities. The own resources of their budgets, when compared with 2015, have increased three times or by UAH 2.3 billion and totalled  UAH 3.3 billion", the expert stated.

In the amalgamated communities, the actual personal income tax return totalled UAH 1.7 million, land tax - UAH 558 million (increased by 58%), excise tax - UAH 368 million (increased by 68%), flat-rate tax - UAH 447 million (increased by 57%).

Yanina Kaziuk noted that the amalgamation of communities allowed increasing the own revenues of the budgets of such communities per capita at the relevant territory. In average, that indicator (in comparison with 2015), by all amalgamated communities, increased by UAH 1,645 (from UAH 700 to UAH 2,345).

According to the information provided by the expert, in 2016, the  revenues of the general fund of local budgets of 159 amalgamated territorial communities, inclusive of transfers from the state budget, totalled UAH 7 billion, that is seven times more in comparison with the revenues to the budgets of local councils in 2015, which councils merged in the amalgamated territorial communities. 

The expert expressed the opinion that maximum strengthening of financial capability of the local self-government by way of transfer of resources thereto should continue to be an important objective for the Government and the Parliament for 2017.

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