Some aspects of the Ukrainian fiscal policy in the context of decentralization: the revenue of local budgets
As a result of the macroeconomic assessment of fiscal policy found an inverse relationship between the level of tax burden on economic growth and the physical GDP. It suggested several ways of reforming the tax legislation, which contribute to economic growth on the basis of the balance of interests...
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Ostrovetskyy, V. 2017-03-19T12:10:46Z 2017-03-19T12:10:46Z 2016 Some aspects of the Ukrainian fiscal policy in the context of decentralization: the revenue of local budgets / V. Ostrovetskyy // Економічний вісник Донбасу. — 2016. — № 4 (46). — С. 85–90. — Бібліогр.: 5 назв. — англ. 1817-3772 https://nasplib.isofts.kiev.ua/handle/123456789/114906 336.22+336.14(477) As a result of the macroeconomic assessment of fiscal policy found an inverse relationship between the level of tax burden on economic growth and the physical GDP. It suggested several ways of reforming the tax legislation, which contribute to economic growth on the basis of the balance of interests of the Government, business and local government. У результаті макроекономічної оцінки бюджетно-податкової політики виявлена зворотна залежність між рівнем податкового навантаження на зростання економіки і фізичного ВВП. Запропоновано декілька напрямків реформування податкового законодавства, які сприяють зростанню економіки на основі балансу інтересів держави і бізнесу, а також органів місцевого самоврядування. В результате макроэкономической оценки бюджетно-налоговой политики обнаружена обратная зависимость между уровнем налоговой нагрузки на рост экономики и физического ВВП. Предложено несколько направлений реформирования налогового законодательства, которые способствуют росту экономики на основе баланса интересов государства и бизнеса, а также органов местного самоуправления. en Інститут економіки промисловості НАН України Економічний вісник Донбасу Finance Some aspects of the Ukrainian fiscal policy in the context of decentralization: the revenue of local budgets Окремі аспекти податково-бюджетної політики України в умовах децентралізації: доходи місцевих бюджетів Отдельные аспекты налогово-бюджетной политики Украины в условиях децентрализации: доходы местных бюджетов Article published earlier |
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Some aspects of the Ukrainian fiscal policy in the context of decentralization: the revenue of local budgets |
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Some aspects of the Ukrainian fiscal policy in the context of decentralization: the revenue of local budgets Ostrovetskyy, V. Finance |
| title_short |
Some aspects of the Ukrainian fiscal policy in the context of decentralization: the revenue of local budgets |
| title_full |
Some aspects of the Ukrainian fiscal policy in the context of decentralization: the revenue of local budgets |
| title_fullStr |
Some aspects of the Ukrainian fiscal policy in the context of decentralization: the revenue of local budgets |
| title_full_unstemmed |
Some aspects of the Ukrainian fiscal policy in the context of decentralization: the revenue of local budgets |
| title_sort |
some aspects of the ukrainian fiscal policy in the context of decentralization: the revenue of local budgets |
| author |
Ostrovetskyy, V. |
| author_facet |
Ostrovetskyy, V. |
| topic |
Finance |
| topic_facet |
Finance |
| publishDate |
2016 |
| language |
English |
| container_title |
Економічний вісник Донбасу |
| publisher |
Інститут економіки промисловості НАН України |
| format |
Article |
| title_alt |
Окремі аспекти податково-бюджетної політики України в умовах децентралізації: доходи місцевих бюджетів Отдельные аспекты налогово-бюджетной политики Украины в условиях децентрализации: доходы местных бюджетов |
| description |
As a result of the macroeconomic assessment of fiscal policy found an inverse relationship between the level of tax burden on economic growth and the physical GDP. It suggested several ways of reforming the tax legislation, which contribute to economic growth on the basis of the balance of interests of the Government, business and local government.
У результаті макроекономічної оцінки бюджетно-податкової політики виявлена зворотна залежність між рівнем податкового навантаження на зростання економіки і фізичного ВВП. Запропоновано декілька напрямків реформування податкового законодавства, які сприяють зростанню економіки на основі балансу інтересів держави і бізнесу, а також органів місцевого самоврядування.
В результате макроэкономической оценки бюджетно-налоговой политики обнаружена обратная зависимость между уровнем налоговой нагрузки на рост экономики и физического ВВП. Предложено несколько направлений реформирования налогового законодательства, которые способствуют росту экономики на основе баланса интересов государства и бизнеса, а также органов местного самоуправления.
|
| issn |
1817-3772 |
| url |
https://nasplib.isofts.kiev.ua/handle/123456789/114906 |
| citation_txt |
Some aspects of the Ukrainian fiscal policy in the context of decentralization: the revenue of local budgets / V. Ostrovetskyy // Економічний вісник Донбасу. — 2016. — № 4 (46). — С. 85–90. — Бібліогр.: 5 назв. — англ. |
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2025-11-25T01:16:56Z |
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| fulltext |
V. Ostrovetskyy
85
Економічний вісник Донбасу № 4(46), 2016
UDC 336.22+336.14(477)
V. Ostrovetskyy,
Berdyansk Management and Business University
SOME ASPECTS OF THE UKRAINIAN FISCAL POLICY IN THE CONTEXT
OF DECENTRALIZATION: THE REVENUE OF LOCAL BUDGETS
The current economic system of Ukraine is charac-
terized by low GDP growth and production, high infla-
tion, unstable exchange rate of the national currency, as
well as negative dynamics of key sectors of the economy
due to unfavorable external conditions and the difficult
economic situation due to the process of decentraliza-
tion of public administration. The main tools to address
the aforementioned issues are systemic nature of mone-
tary and fiscal policy. Fiscal policy is characterized by
greater controllability as measures taken in this area and
the effects of their implementation are exposed to pre-
cise measurement in monetary terms.
Formation and development of institute of local
government in Ukraine is impossible without develop-
ment of relations between the Government, local gov-
ernments, businesses and households. The main objec-
tive in the field of local governance, which is both a sig-
nificant challenge is to strengthen the revenue sources
of local authorities in order to develop economically ca-
pable, competitive and self-sufficient United Local
Communities (ULC). For modernization model of local
government, which is a priority of the current economic
policy of Ukraine needs to develop concrete and effec-
tive solutions and suggestions for improving the process
of financial resources ULC. The crucial issue here is the
chronic lack of own revenue base to finance ULC to
their authority. Revenues of budget of ULC in the form
of national and local taxes do not fully address the needs
of local authorities on the financial security of their con-
stitutional powers. More than half of total expenditures
of local importance are funded by intergovernmental
transfers, transferred in favor of local governments from
the state budget of Ukraine.
Analysis of recent research. Methodological ba-
sis of decentralized governance lies in the writings of
G. Brennan, J. Buchanan, R. D. Ebel, R. Ezcurra, M. Ol-
son, W. Oates, P. Seabright Ch. Tiebout, A. Shah,
P. Pascual, R. Prud'Homme D. Rondinelli, P. Seabright,
G. Stigler and others. Conceptual issues of tax policy
dedicated to the works of A. Auerbach, W. Batt, R.M.
Bird, P. Diamond, J. Stiglitz, P. Shome, V. Tanzi,
A. Tait, R. Wagner and others.
The issue of state regulation of the economy, in-
cluding improvements in tax management tools, eco-
nomic system, in terms of changes in the basic principles
of public administration, decentralization caused partic-
ularly dedicated work of many leading scientists, in-
cluding V.F. Besedin, Z.S. Varnaliy, O.D. Danilov, J.B.
1 The tax burden is measured by taking the total tax revenue in GDP. – OECD, available at: https://data.oecd.org/.
Ivanov A.I. Krysovatyy, I.A. Lunina, V.N. Melnik,
S. Onishko, V.M. Oparin, V.K. Simonenko, V.F. Sto-
lyarov and others. In the works of these authors is sug-
gested scientific and practical advice in the management
of public finances, tax system.
Basic principles, principles and criteria and propor-
tions, shape and mechanism of accumulation of finan-
cial resources for the various levels of government are
particularly important in the transformation of the rela-
tionship between the central levels of government and
local jurisdictions. Any innovations in public admin-
istration in need of financial support at all stages of their
development, implementation and administration. Ac-
cordingly, the need to study and major transformation
vectors revenue base of local self-oriented budgeting in
local governments which can ensure accelerated re-
gional development in all spheres of economic and other
activities. The purpose of this publication is to identify
specific areas of improvement budget and tax legislation
of Ukraine by reviewing important standards accumula-
tion of financial resources at different levels of the
budget system of Ukraine.
Macroeconomic analysis of tax policy Ukraine.
The global and domestic crisis virtually paralyzed eco-
nomic system of Ukraine. In these conditions growing
actuality is developing, aimed at preparing proposals to
stabilize and stimulate economic growth, fiscal nature in
particular. Dynamics and trends of key macroeconomic
indicators and proportions that characterize the fiscal
sphere, primarily in 2008-2009 yy. and 2014-2015 yy.,
have undergone significant changes. The analysis of the
dynamics of the consolidated budget revenues Ukraine
to evaluate the effectiveness of tax policy of Ukraine al-
lows to identify the main policy measures to stimulate
economic growth.
Analyzing the structure of consolidated budget rev-
enues can say that a significant proportion of revenues
to tax revenues (see. table 1). The analysis of their share
in GDP allows assume to grow the overall tax burden1
on the economy of Ukraine with simultaneous reduction
of the tax burden on capital.
At the same time, if in some developed countries
per capita a year accounts for 20 thousand USD tax rev-
enues, in Ukraine – 0.8 thousand USD. In nominal
terms, tax revenues consolidated budget of Ukraine are
growing rapidly, outstripping GDP growth of 5-7%. In
2015 y. the revenue was more than 16 times compared
to 2000 у.
V. Ostrovetskyy
86
Економічний вісник Донбасу № 4(46), 2016
Table 1
Dynamics of the share revenue of consolidated budget Ukraine in GDP, %
Indexes 2005 2010 2011 2012 2013 2014 2015
GDP, bln. UAH. 441,5 1120,6 1349,2 1459,1 1522,7 1586,9 1979,5
Revenue of consolidated
budget
30,4 28,1 29,5 30,5 29,1 28,7 32,9
Tax Revenue 22,2 20,9 24,8 24,7 23,2 23,2 25,6
Nontax Revenue 7,2 6,6 4,4 5,5 5,6 5,1 7,1
Other Revenue 1,0 0,6 0,3 0,3 0,3 0,5 0,2
Source: compiled by the authors according to the State Treasury Service of Ukraine. - Electronic resource. -
2017 - Available at: http://www.treasury.gov.ua/
Figure 1 illustrates the inverse sustainable, albeit
non-linear relationship between the proportion of the
share of Tax Revenues in GDP and changes in volume
index of GDP. That increased pressure from the govern-
ment in the form of increasing the volume of GDP re-
distribution through the budget system of Ukraine neg-
atively affects the physical dynamics of growth of GDP.
From Figure 1 shows that the slowdown in GDP
physical volume is almost always accompanied by the
growth of consumer price index (CPI). However, the
stable relationship between the proportion of tax reve-
nues of the consolidated budget in the GDP price index
and the analysis of correlation coefficients in the inter-
val 2000 - 2015 years weren’t found.
Source: Calculated by the author using Microsoft Excel software for data: Statistical Yearbook of Ukraine. State Statistics
Service of Ukraine. – 2016. – 575 p.
Fig. 1. Dynamics of the share Tax Revenue of total budget Ukraine in GDP and certain macroeconomic
variables for 2000-2015, %1
Is observed a strong inverse relationship between
GDP volume index and the consumer price index (cor-
relation coefficient is (-0.4)). At the same time, tracked
almost direct correlation (correlation coefficient is 0.90)
between the growth of GDP and physical capital invest-
ment (CI) and inverse (correlation coefficient (-0.39))
between the tax burden and the growth of CI.
1 ІФО ВВП (VI GDP) - The physical volume index of GDP, %; ІСЦ (CPI) – the consumer price index, %; КІ (CІ )–
Capital Investments, %; ПН ВВП (TR GDP) – the share Tax Revenue of consolidated budget Ukraine in GDP, %
As a result of the macroeconomic evaluation of tax
policy Ukraine could argue the trend of increasing the
tax pressure on the economy in Ukraine, accompanied
by slower growth in physical volumes of GDP and cap-
ital investment (CI). At the same time, the growth rate
of CI directly affect the physical volumes and slowing
GDP growth by raising the tax burden on the economy
of Ukraine.
-50
-40
-30
-20
-10
0
10
20
30
40
50
60
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
ІФО ВВП ІСЦ ПН у ВВП КІ
V. Ostrovetskyy
87
Економічний вісник Донбасу № 4(46), 2016
The mentioned conclusions and observations make
it possible to formulate some directions of reforming the
tax legislation, which aims should be to balance the in-
terests of the state and business to stabilize the economic
situation and sustainable development of the economic
system of Ukraine. Following definitions, can carefully
use to reduce tax rates of national taxes while gradually
moving the tax burden from mobile factors of produc-
tion (capital and labor) for non-mobile (land, natural re-
sources), as well as the consumption of certain goods
whose production is detrimental to the environment (or
the consumption of which is harmful to human health),
in conjunction with increasing the efficiency of tax ad-
ministration and promote investment activity.
An important factor in development as a separate
economic activity and individual enterprise are tax de-
preciation. Tax depreciation has to stimulate the invest-
ment. Necessary the existing rules of the tax deprecia-
tion to improve. The volume of depreciation has to equal
to the economically viable life of the assets. In times of
financial crisis it is expedient to introduce a regime of
higher rates of tax depreciation charges for stimulate in-
vestment activity.
It should also give due consideration to enhance the
efficiency of tax administration. One of the ways could
be the development of organizational and institutional
conditions for de-offshore economy of Ukraine and de-
termine the normal price for tax purposes. Another is to
strengthen control over the registration of businesses,
preventing inclusion in the chain of taxable transactions
fictitious companies.
Particular attention should be paid special (privi-
leged) taxation regimes. Reporting on the use of funds
released as a result of tax benefits the taxpayer, does not
allow the full measure to track trends and effectiveness
of funds received by the taxpayer as a result of the of-
fering of tax preferences. To improve the effectiveness
of tax incentives in Ukraine should introduce a system
of special passports of tax benefits (PTB), which de-
clares the taxpayers amounts of benefits and uses of fi-
nancial resources accumulated in the company resulting
from use of the right to tax relief[1].
Among other objectives of tax policy Ukraine
should emphasize the need to ensure timely VAT re-
funds from the state budget, which will be held at the
same time improving the efficiency of tax administra-
tion and strengthening of the tax debt. In practice, the
main debtor to pay taxes is the public sector. Collection
of tax arrears, which greatly complicates their speciali-
zation and other factors, systemic and administrative.
Thus there is a "subsidy" of state enterprises due to "de-
lay" the return of VAT to private enterprises.
Requiring ongoing attention the formation (fore-
casting, planning and execution) in tax revenues for the
next budget period and medium term. After underper-
formance plans to mobilize fiscal revenues in conjunc-
tion with the aggravating impact of tax policy on the de-
velopment of certain economic sectors unsatisfactory
appear on the functioning of the financial system of
Ukraine.
Some aspects fiscal policy in a decentralized
Ukraine. The development of effective multi-level
budget system are crucial for any country in the world.
However, despite the possibility of a number of basic
principles, conditions and criteria for the formation of
intergovernmental relations, the ideal model of relations
between the central and local level jurisdictions in prac-
tice does not exist. It explains the diversity of models of
government administration which used in many coun-
tries. Features budgeting of local governments defined
model of government administration.
In world practice a few such models. Anglo-Saxon
model, which is built in the UK to the US, Canada, In-
dia, Australia and other federal states. The model is
characterized by a high degree of autonomy of local
governments. In continental Europe (France, Italy,
Spain) and most of Latin America, the Middle East used
a model that combines local government to local admin-
istrations and characterized restrictions autonomy of lo-
cal governments, the presence of state commissioners
and others. Most countries use a mixed model, but the
overall trend of global governance models aimed at op-
timization of local governments by improving their au-
tonomy.
The choice of a model of budgetary regulation is a
difficult issue for each state. There are different ap-
proaches to the classification of the types of models
budgetary adjustment. The most common is the classifi-
cation of the similarity of budgetary control and value
the role of the central and subnational governments. For
example, in the Nordic countries (Denmark, Norway,
Finland, Sweden), where per capita GDP ranges from
50-70 thousand USD local governments play an im-
portant role in financing social expenditures. Half of the
total expenditure budgets of these countries, or from 25
to 35% of GDP, financed by local budgets. At the same
time, these countries are characterized by the highest
share of financial security powers of local government
through taxes, which remain at the disposal of local au-
thorities.
Instead, the public administration system in Aus-
tria, Germany and Switzerland are characterized by con-
siderable autonomy budgets of different levels based on
their active cooperation. The share of local spending in
total expenditure in these countries varies within 17-
20%, or 7-8% of GDP. But in terms of ensuring the
functions of local authorities from their own tax reve-
nues, in Austria they account for 20% of local spending
in Germany - 35%, and Switzerland - more than 60%.
Other European countries, including Belgium, Por-
tugal, Spain, Italy and France, where GDP per capita is
much lower than in other EU countries, at 20 thousand
USD local budgets remain dependent on the central
budget level. The share of local spending in total ex-
V. Ostrovetskyy
88
Економічний вісник Донбасу № 4(46), 2016
penditure in these countries varies from 20 to 50%, or 6
to 15% of GDP. On average, one third to one half of the
expenditure of local governments in these countries is
funded by local tax revenues.
The importance of local governments in industrial-
ized countries is determined by comparing two indica-
tors: the share in consolidated expenditures and the per-
centage of local expenditures to the of GDP. Table 2
presents statistics on the proportion of budget indicators
of different levels of GDP in individual countries of the
European Union (EU).
Table 2
Budgetary indicators (spending and tax revenues) in terms of levels
of government in some countries European Union in 2015
Countries
GDP
The share expenditures in
GDP, %
The share of
local ex-
pendintures
in total ex-
penditure, %
The share tax revenues in
GDP1, %
Total,
bn. USD
Per capita,
USD
Total
budget
Local
budget
Total
budget
Local
budget
Austria 374 43724 51,6 8,6 16,7 43 1,4
Belgium 455 40106 53,9 7,2 13,4 44,7 2,1
Denmark 295 52114 54,8 34,9 63,7 50,9 12,6
Spain 1200 25864 43,8 6 13,7 33,2 3,3
Italy 1816 29866 50,4 14,5 28,8 43,6 6,9
Germany 3358 40996 44,0 7,8 17,7 36,1 2,5
Norway 389 74822 48,8 16,1 33,0 39,1 5,4
Portugal 199 19121 48,4 5,9 12,2 34,4 2,5
Finland 230 41973 57,7 23,6 40,9 43,9 10,3
France 2422 37675 57,0 11,4 20,0 45,2 5,9
Switzerland 665 80675 33,9 7,1 20,9 26,6 4
Sweden 493 49866 50,3 25 49,7 42,7 15,8
1 Available data from official sources by 2014. The relative stability of relations budget indicators in GDP in the EU allows
to compare and to do assumptions and conclusions.
Source: compiled according to the author: 1) Eurostat, available at:: http://appsso.eurostat.ec.europa.eu/; 2) ОЕСР: -
Revenue Statistics - OECD countries: Comparative tabl , available at: s: https://stats.oecd.org/Index.aspx?DataSetCode=REV;
3) World Economic Outlook Database-April 2016, International Monetary Fund. Accessed on 12 April 2016.
On average in the EU local authorities by funding
their functions and powers redistribute at 10-11% of
GDP. However, in the EU observed significant differ-
ences in the ratios of the share of expenditures of local
governments in total expenditures and GDP. The Scan-
dinavian countries (Denmark, Sweden, Finland) are
leaders for both indicators. The local governments of
Denmark funding more than 60% of total expenditure,
representing over 30% of GDP. Followed them go Italy,
France, Germany and other countries - old EU members.
In these countries, the share of expenditure budgets of
local governments to GDP ranges from 10%, or at the
level of 25-30% of total public expenditure for the pe-
riod. This list is end Malta, Ireland, Greece, Cyprus.
The potential growth of the local jurisdiction, its
competitiveness and attractiveness for placing invest-
ments can be described capacity revenue base, propor-
tions of distribution of financial resources between lev-
els of government. Many scientific studies noted in uni-
tary countries centralization of budget funds higher. In-
stead, a greater degree of decentralization observed in
federal countries, including the US and Canada. Much
of these countries accumulates funds in the budgets of
social security funds, local budgets and the budgets of
members of [2]. In the EU the average central govern-
ment redistributes 24% of GDP, the state government
(land, canton, etc.) - 5% of GDP, local governments at
12% of GDP and social funds - up to 16% of GDP.
Overall, the EU marked tendency to strengthen the role
of local government in the redistribution of GDP with a
simultaneous increase their socio-economic importance
[3-4].
Ukraine is financed by only one third of the powers
of local authorities by taxes. The rest of the financial
needs of local authorities, mainly social issues (educa-
tion, health) is provided by the system of intergovern-
mental transfers in the form of grants, special grants
from the State Budget of Ukraine (see Table 3). After
the last reform of intergovernmental relations [5] in
Ukraine there is a tendency to reduce the share of own
revenues to fund expenditures at the local level. It is
noted faster growth of the share of total revenues of lo-
cal governments in Ukraine GDP compared to tax reve-
nues to local budgets of Ukraine. Most significant
source of revenue of the government in Ukraine remains
traditionally income tax. However, statistical data (see
V. Ostrovetskyy
89
Економічний вісник Донбасу № 4(46), 2016
Table 3) indicate a tendency for its decrease in total rev-
enues of local budgets Ukraine. Additional financial re-
sources of local governments was the share of corporate
income tax, 10% deductions which remains at the dis-
posal of local authorities in Ukraine.
In an unstable domestic economic situation in
Ukraine, characterized by a decrease in volumes and re-
orientation of national production, job cuts and real in-
comes due to unfavorable external conditions, and the
worldwide trend to reduce tax profits, other immutable
circumstances, it is difficult to expect conversion of
these revenue sources of local budgets for powerful fi-
nancial lever for regional development.
Table 3
Dynamics revenue of local governments Ukrainefor the 2005-2016 years, mln. UAH.
2005 2010 2012 2013 2014 2015 20161
Total (without transfers) 30316 80516 100814 105171 101101 120480 152743
Official transfers 23358 78881 124460 115848 130601 173980 189543
Total 53660 159397 225274 221019 231702 294460 342286
GDP 441452 1120585 1459096 1522657 1586915 1979458 2262800
The Structure of Local Budgets Ukraine%
Total (without transfers) 56,5 50,5 44,8 47,6 43,6 40,9 44,6
Tax Revenue 44,0 42,4 38,1 41,3 37,7 33,4 38,3
Tax and tax on personal income 30,7 32,0 27,1 29,2 27,0 18,7 21,8
Corporate income tax 0,4 0,2 0,2 0,3 0,1 1,5 1,4
Excise tax 0,0 0,0 0,0 0,0 0,0 2,6 3,1
Non Tax Revenue 6,6 5,5 5,6 5,5 5,3 6,8 5,6
Other Revenue 5,9 2,6 1,0 0,8 0,7 0,7 0,8
Official transferts 43,5 49,5 55,2 52,4 56,4 59,1 55,4
Total 100,0 100,0 100,0 100,0 100,0 100,0 100,0
The Share Revenue of Local Budgets in Ukraine GDP, %
Total (without transfers) 6,9 7,2 6,9 6,9 6,4 6,1 6,8
Tax Revenue 5,3 6,0 5,9 6,0 5,5 5,0 5,8
Tax and tax on personal income 3,7 4,6 4,2 4,2 3,9 2,8 3,3
Corporate income tax 0,0 0,0 0,0 0,0 0,0 0,2 0,2
Excise tax 0,0 0,0 0,0 0,0 0,0 0,4 0,5
Non Tax Revenue 0,8 0,8 0,9 0,8 0,8 1,0 0,8
Other Revenue 0,7 0,4 0,2 0,1 0,1 0,1 0,1
Official transfers 5,3 7,0 8,5 7,6 8,2 8,8 8,4
Total 12,2 14,2 15,4 14,5 14,6 14,9 15,1
1 Included in the calculation of the approval of the State Budget of Ukraine for 2017. Be subject to clarification.
Source: compiled by the author according to the State Treasury Service of Ukraine, available at: http://www.treas-
ury.gov.ua/
Gradually increasing proportion of ad valorem
component of excise tax, which was introduced from
2015, due to low elasticity of demand for excise goods,
they are stable, relatively uniform consumption within
the territory of Ukraine, as well as inflation.
The mentioned observations, including on increas-
ing trend of official transfers in the income structure of
local government budgets Ukraine allow to draw con-
clusions about the restriction of local authorities of
Ukraine regarding financing and delegated powers at the
expense of their own source revenues.
Conclusions and suggestions. Among the expla-
nations for these negative trends of the revenue base of
local government in Ukraine may be unfavorable exter-
nal environment, hence the poor performance of key dy-
namics of the main economic activities that adversely
affects the stability of exchange rate, stimulates the un-
winding inflationary spiral and is causes growth of un-
V. Ostrovetskyy
90
Економічний вісник Донбасу № 4(46), 2016
employment and reducing the sphere of material pro-
duction. Among the internal factors should be high-
lighted imperfection fiscal planning, in terms of limited
opportunities to develop own revenue base local govern-
ments through tax revenues.
In general terms, it is appropriate to continue to
gradually shift the tax burden from mobile factors of
production (capital and labor) for non-mobile (land, nat-
ural resources), as well as the consumption of certain
goods whose production is detrimental to the environ-
ment (or the consumption of which is harmful to health
of human), in conjunction with increasing the efficiency
of tax administration and improve the mechanism of for-
mation of budget revenues of local government in
Ukraine based on the expansion of the powers of accu-
mulation of tax revenues.
To this end, it is appropriate to consider the possi-
bility to gradually increase the share of corporate in-
come tax, which remains at the disposal of local govern-
ments of Ukraine and take measures for improvement of
depreciation policy. These solutions will reduce the tax
debt of paying corporate income tax including interest
and encourage local authorities to Ukraine of production
on their own territory, as tax revenues from taxation of
corporate profits will remain at their disposal.
As for the excise tax, it should be noted that it is
the taxpayers are end users excisable goods. Manufac-
turers and importers of excisable goods take tax and
transfer to the budget mainly in the price of its imple-
mentation. The relatively small share of excise tax with-
held at retail. However, the production and clearance of
excisable products in Ukraine is uneven as opposed to
consumption. In these conditions need reduce specific
excise tax, paid by producers (importers) of excisable
products with increasing ad valorem component, which
remains at the disposal of local authorities. It will
strengthen the financial capacity of local governments
in Ukraine.
References
1. Ostrovetskyy V.I. Some aspects of transform-
ing instruments of fiscal management of the economy of
Ukraine / Ukraine Economy: Investment and innovative
component / Common. Ed. V.F. Besedin AS
Muzychenko. – K.: NDEI. – 2012. – 292 p. – S. 268-
272. 2. Управление на местном уровне в развиваю-
щихся странах / Под ред. Анвара Шаха; пер. с
англ. – М.: Весь Мир, 2004 – 328 с.; Управление на
местном уровне в индустриально развитых странах
/Под ред. Анвара Шаха; пер. с англ. – М.: Весь Мир,
2010 – 416 с. 3. Annual Government Finance Statis-
tics [Електронний ресурс] / Eurostat. – 2017. –Режим
доступу: http://www.epp.eurostat.ec.europa.eu/. 4. Re-
venue Statistics – Comparative tables. Total tax revenue
as percentage of GDP / OECD-Stat, Organization for
economic co-operation and development, available at:
http://stats.oecd.org/. 5. Про схвалення Концепції ре-
формування місцевого самоврядування та територі-
альної організації влади в Україн: Розпорядження
Кабінету Міністрів України Концепція від
01.04.2014 р. № 333-р. [Електронний ресурс]. – Ре-
жим доступу: http://zakon3.rada.gov.ua/laws/show/
333-2014-%D1%80.
Островецький В. І. Окремі аспекти подат-
ково-бюджетної політики України в умовах де-
централізації: доходи місцевих бюджетів
У результаті макроекономічної оцінки бюд-
жетно-податкової політики виявлена зворотна за-
лежність між рівнем податкового навантаження на
зростання економіки і фізичного ВВП. Запропоно-
вано декілька напрямків реформування податкового
законодавства, які сприяють зростанню економіки
на основі балансу інтересів держави і бізнесу, а та-
кож органів місцевого самоврядування.
Ключові слова: податкова політика, децентралі-
зація, податки, бюджет, органи місцевого самовря-
дування.
Островецкий В. И. Отдельные аспекты
налогово-бюджетной политики Украины в усло-
виях децентрализации: доходы местных бюдже-
тов
В результате макроэкономической оценки бюд-
жетно-налоговой политики обнаружена обратная за-
висимость между уровнем налоговой нагрузки на
рост экономики и физического ВВП. Предложено
несколько направлений реформирования налого-
вого законодательства, которые способствуют росту
экономики на основе баланса интересов государства
и бизнеса, а также органов местного самоуправле-
ния.
Ключевые слова: налоговая политика, децен-
трализация, налоги, бюджет, органы местного само-
управления.
Ostrovetskyy V. Some Aspects of the Ukrainian
Fiscal policy in the Context of Decentralization: the
Revenue of Local Budgets
As a result of the macroeconomic assessment of
fiscal policy found an inverse relationship between the
level of tax burden on economic growth and the physical
GDP. It suggested several ways of reforming the tax leg-
islation, which contribute to economic growth on the ba-
sis of the balance of interests of the Government, busi-
ness and local government.
Keywords: tax policy, decentralization, taxes, the
budget, local governments.
Received by the editors: 16.12.2016
and final form 28.12.2016
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