ВИРІВНЮВАННЯ ВЕРТИКАЛЬНИХ ФІСКАЛЬНИХ ДИСБАЛАНСІВ В УКРАЇНІ

Abstract

The article identifies the peculiarities of the system of vertical fiscal imbalances equalization in Ukraine in the context of decentralization. The discrepancy between the financial resources of local budgets and the scope of delegated powers to provide social services guaranteed by the state causes vertical fiscal imbalances, which are levelled in Ukraine by providing subventions from the state budget. The author analyses the structure and dynamics of intergovernmental transfers to local budgets from the State budget to equalize vertical fiscal imbalances for the period from 2012 to 2022. It is established that the decline in the volume of subventions to local budgets since 2019, as well as the decline in the share of intergovernmental transfers in local budget revenues and the simultaneous decrease in the share of intergovernmental transfers in state budget expenditures should not be interpreted as evidence of the decentralization reform success, since such a decline is a consequence of other processes - numerous reforms and changes in the priorities of state policy on regional development. The constant redistribution of expenditure powers delegated to local budgets by the central government, which is reflected in the dynamic change in the structure of intergovernmental transfers, demonstrates the inconsistency of public policy and the turbulence of the budget system, as well as the unsystematic nature of vertical equalization processes. The functions and responsibilities of different levels of government in the provision of state-guaranteed social services are not clearly delineated in Ukraine. The amount of state grants and subventions, which has been decreasing annually since 2019, is insufficient for local budgets, as evidenced by their chronic deficits. It is proposed to eliminate vertical fiscal imbalances by clearly distinguishing between own and delegated powers of local budgets to provide state-guaranteed social services, assessing their cost, and the relevant increasing the resource base of local budgets by assigning a larger percentage of national taxes, including personal income tax, to local budgets.