Ensuring financial self-sufficiency of territorial communities: the experience of EU countries for Ukraine
Journal Title: Visnyk Ternopilskoho natsionalnoho ekonomichnoho universytetu - Year 2016, Vol 1, Issue
Abstract
The article, based on the experience gained from the Republic of Poland and the Republic of Bulgaria, revealed the achievements and problems of fiscal decentralization in the context of the reform of public administration. Financial self-sufficiency of communities was defined as the ability of their representative bodies to finance as fully as possible the delegated responsibilities through the effective use of financial resources formed with the active use of potential opportunities in accordance with the current legislation. The basic stages of fiscal decentralization in the countries were analyzed, and it was noted that it was preceded by determining the structure of local government and a clear sharing of responsibilities between all levels of public administration. The sources of local revenues and their structure were founded, as well as the capabilities of representative bodies to affect their scope. It was concluded that the own incomes of local communities which were formed primarily from local taxes were the basis of financial self-sufficiency in the surveyed countries. Despite certain differences property taxes that have a stable fiscal potential under any economic conditions are the most of them. It was shown that the European Union grants, which on terms of shared sponsorship were allocated to the implementation of investment projects, were a significant source of income for local communities in the new member states. The need for intergovernmental transfers for local authorities implementing delegated responsibilities was indicated, their types were described and the problems of the mechanism of their calculation and rendering were founded. The uses of the local communities’ budgets in Poland and Bulgaria were characterized; the significant share of capital costs for local development was referred. The problems associated with lack of state funding of the delegated responsibilities of local authorities were clarified. The positive features of tax andinter-budgetary relationssystemsof the surveyedcountries which should be taken into account during financial centralization in Ukraine were revealed.
Authors and Affiliations
Svitlana Yehorycheva, Mykola Lakhyzha
Keywords
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