The Decentralisation Made It Possible to Increase Revenues of Local Budgets, Yanina Kaziuk Informed about the Results of Eight Budget Months

Over the period of eight months of the current year, the earned revenues of local budgets of the 366 amalgamated territorial communities (ATCs) increased by 85.5% and totalled UAH 5.5 billion (+ UAH 2.5 billion). The average per capita amount of influx of the earned revenues in the amalgamated territorial communities increased by UAH 816 and totalled UAH 1,771. It was reported so by Yanina Kaziuk, Financial Decentralisation Coordinator of the Central Office for Reforms at the Ministry of Regional Development (with the assistance of the U-LEAD Programme).

She recalled that 207 of the 366 amalgamated territorial communities transferred to direct inter-budgetary relations with the state budget from the beginning of 2017. And their own resources, in comparison with the same period in the previous year, increased almost by three times and totalled UAH 2.9 billion (+ UAH 1,9 billion).

One year older communities, that is 159 ATCs, show the rate of growth of their earned revenues for the reporting period by 34.3% or by UAH 668.1 million, in comparison with the previous year, which growth is higher than average in Ukraine (the rate of growth of the earned revenues of local budgets in Ukraine is 30.8%).

Over the period of eight months, the 366 ATCs received a government grant from the state budget in the amount of UAH 826.3 million for the development of infrastructure.

Yanina Kaziuk underlined that the financial decentralisation had a beneficial effect on the revenue structure of local budgets, in particular, on the share of local taxes and levies. If, in 2007 to 2010, their share totalled 1.1% - 1.4% only, in 2016, it already mounted up to 27.1%. The proceeds from the land use fee and the flat-rate tax comprise the largest percentage in the structure of local taxes and levies, 100% of which are retained by budgets of the bodies of local self-government.

"Taking into account that the imposition and determination of the rates of local taxes and levies is vested in the bodies of local self-government, they are actually capable to have an effect on the amounts of the said payments to respective budgets", the expert noted.

 

The influx of own resources to all 366 amalgamated territorial communities over the period of January to August 2017, in comparison with the same period of 2016:

in total - UAH 5.5 billion (an increase of 85.5% or by UAH 2.5 billion), in particular:

personal income tax totalled UAH 3.1 billion (an increase by more than three times or by UAH 2.1 billion);

land use fee totalled UAH 947.1 million (an increase of 20.4% or by UAH 160.7 million);

flat-rate tax totalled UAH 780.7 million (an increase of 45.9% or by UAH 245.6 million);

excise tax totalled UAH 410.8 million (a decrease of 9.3% or by UAH 42.3 million);

immovable property tax totalled UAH 90.8 million (an increase of 69.8% or by UAH 37.3 million).

 

The influx of own resources to the local budgets of the 159 amalgamated territorial communities over the period of January to August 2017, in comparison with the same period of 2016:

in total - UAH 2.6 billion (an increase of 34.3% or by UAH 668.1 million), in particular:

personal income tax totalled UAH 1.5 billion (an increase of 45.6%);

land use fee totalled UAH 445.1 million (an increase of 17.8%);

excise tax totalled UAH 213.2 million (a decrease of 9.9%);

flat-rate tax totalled UAH 335 million (an increase of 46.8%);

immovable property tax totalled UAH 41.2 million (an increase of 66.8%).

 

The influx of own resources to the local budgets of the 207 amalgamated territorial communities over the period of January to August 2017, in comparison with the same period of 2016:

in total - UAH 2.9 billion (an increase by almost three times or by UAH 1.9 billion), in particular:

personal income tax totalled UAH 1.6 billion;

land use fee totalled UAH 502 million (an increase of 22.9%);

excise tax totalled UAH 197.7 million (a decrease of 8.8%);

flat-rate tax totalled UAH 445.7 million (an increase of 45.2%);

immovable property tax totalled UAH 49.7 million (an increase of 72.5%).

Note. The information is provided with reference to official data of the Ministry of Finance of Ukraine on the basis of achievement of local budget targets by the amalgamated territorial communities prior to and after their voluntary amalgamation and after the acquisition thereby of the right to direct inter-budgetary relations with the state budge

Source:

Press Centre of the "Decentralisation of Power" Initiative

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