Interbudgetary transfers as a financial instrument for reducing disparities and intensifying of regional development

Abstract

Monitoring of socio-economic development of administrative and territorial units was carried out and asymmetry of regional development with a trend towards non-essential reduction of interregional disparities was detected. It was established that the expediency of using interbudgetary transfers is due to the limited resources of local budgets for the proper provision of public services to the population. The reasons for this are the differences in regional development, delegation of powers from the state to local self-government bodies and the need to provide them with a sufficient amount of financial resources. The practice was characterized and the problems of granting subventions to local budgets for the implementation of measures on social and economic development of certain territories were identified. The changes in the amount of budgetary support for the implementation of powers of local self-government bodies as a result of the movement of interbudgetary transfers are analyzed. The algorithm of budget regulation is proposed, which provides for the gradual use of the tools of such regulation and allows to improve the budgetary provision of implementation: delegated powers of local self-government bodies at the expense of state budget resources by ensuring compliance between budgetary resources received from state authorities and their need; their own self-governing powers of local self-government bodies at the expense of directing to their implementation of their own revenues of local budgets in full without diverting part of the budget resources for the implementation of delegated powers. It is recommended to evaluate the effectiveness of budget regulation on the basis of the indicator of the level of provision of budgetary resources delegated by the state to local self-government bodies. The article emphasizes the priority of using such a tool of budget regulation as fixed income in the form of national taxes and fees in full or their share and taking into account when calculating the taxability index of local budgets of revenues of all national taxes and fees assigned to them in the volumes determined by the Budget Code of Ukraine.