Decentralisation of land relations will provide 30-40% increase in budget revenues from land payment

This information is reported in the Government’s Newsletter.

The Cabinet of Ministers of Ukraine commences the process of transferring land outside settlements to the ownership of amalgamated hromadas. According to the CMU, the process of transfer of land outside settlements to the ownership of amalgamated hromadas will begin from the 1 February.

How exactly will the land be transferred to hromadas?

The Government has instructed the State Service of Ukraine for Geodesy, Cartography and Cadastre (StateGeoCadastre) to conduct inventory of such land with the subsequent transfer of state-owned agricultural land plots to the communal ownership of the respective amalgamated hromadas from 1 February 2018 in accordance with Article 117 of the Land Code of Ukraine. Besides, from now on, the transfer of such land plots for use (exclusively through auctions) or into the ownership will be carried out only with the consent of amalgamated hromadas and after their decision made in accordance with Article 26 of the Law of Ukraine “On Local Self-Government in Ukraine”.

“Starting from tomorrow no land cadastre centre of the country has the right to make decisions at their own discretion,” said Volodymyr Groysman. “God forbid, someone tries to transfer the land outside the settlement (without the consent of the AH). Such actions will entail criminal liability – throwing out of the room.”

Governmental decision will promote hromada development

Due to the initiative of the Government, from now on hromadas themselves, and not the officials, will make decisions promoting the development of agricultural production and investment attraction, as well as significantly increasing revenues of local budgets. In addition, the decentralisation of land relations will enable to overcome the problem of corruption in this sector. The hromada council itself determines the land tax rate, 100% of which remains in the local budget.

How much land can amalgamated hromadas receive at their disposal?

Last year, the budget revenues of AHs from land payment increased by 20% - up to UAH 1.4 billion. Due to the decision of the Government, the proceeds can increase substantially, as up to 7.2 million hectares may appear at the disposal of amalgamated hromadas, of which 2.5 million hectares are not yet distributed among users. Tax revenues from the use of land located outside settlements may amount to 10% of the AH budget revenues.

Why should AHs dispose of the land outside settlements?

Currently, the StateGeoCadastre is in charge of the land outside settlements. A substantial part of this land was leased at the smallest rent fee – 1-3%, that is, at below-the-market price, and amalgamated hromadas were completely moved aside from disposal of such land plots of state ownership. It increased the risk of corruption, and hromadas did not receive all the funds for their development. In fact, local self-governments had an impact on only 12% of their own territories and were deprived of opportunities to effectively plan their development.

How will the budgets of hromadas increase due to the Governmental decision?

According to the expert assessment, due to wider opportunities of local self-government bodies in terms of land disposal, the estimated volumes of additional revenues to local budgets from land payment may increase by 30-40%.

31.01.2018 - 14:49 | Views: 16073
Decentralisation of land relations will provide 30-40% increase in budget revenues from land payment

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