Tax Revenues to the Budgets of the United Territorial Communities as a Source of Financing for Their Development

Abstract

Diversification of tax revenues to the budgets of the United Territorial Communities (UTC) enhances the capacity of local self-government authorities to finance community development. The article is aimed at identifying the prospects for the formation of the own incomes of the combined territorial communities on the basis of an analysis of the sources of tax revenues of the UTC in the Central Region of Ukraine. Tax revenues to local budgets in Europe are considered. Absence of a unified approach to the formation of financial resources of local governments is proved. The own budget revenues of the UTC in the Central Region of Ukraine are analyzed. It is determined that, in the structure of own incomes, local taxes and fees provide half of all revenues only for a small part of the existing UTC. The main source of the own budget incomes for the Central Region’s average UTC is the income tax, almost 80% of which comes from the taxation of wages of employees in private enterprises and individuals - entrepreneurs. Prospects for forming the own revenues to the budgets of the UTC in the Central Region of Ukraine, depending on the main source of their tax revenues, are characterized. Based on the carried out analysis, the optimal structure of tax revenues to the budgets of the UTC in the Central Region of Ukraine is developed, which will increase the financial independence of territorial communities from the instruments of the State financial support of their development.

Keywords

• local budgets
• local taxes
• personal income tax
• united territorial community
• income