Relevance. Taxes are called, on the one hand, to form the financial resources of local self-government bodies, and on the other, to serve as an instrument of socio-economic policy of the municipality. In most foreign countries, municipal budgets are formed at the expense of tax revenues and are the basis of the country's economic security, in Russia they have become the most problematic link in the budget system. Purpose. The article is aimed at substantiating promising areas for increasing the tax potential of local budgets on the basis of a comprehensive study of the peculiarities of the formation of local budget revenues, an analytical-systematized approach, the existing regional fiscal practice. Tasks. The article solves the following tasks: an analysis and assessment of local budget revenues in the Russian Federation is carried out, factors influencing the formation of local budget revenues are reflected, and ways to increase tax revenues are considered. Objectives: analysis and assessment of local budget revenues of the Russian Federation, substantiation of promising areas for increasing the tax potential of local budgets on the basis of an analytical-systematized approach, existing regional fiscal practice. Methodology. The methodological base of the study is based on a systematic approach, within the framework of which the methods of logical, economic-statistical and dynamic analysis were used. Results. The article presents an analysis and assessment of local budget revenues of the Russian Federation, substantiates promising areas for increasing the tax potential of local budgets on the basis of an analytical-systematized approach, the existing regional budget and tax practice. It is concluded that the interdepartmental active work on the legalization of labor activity of foreign citizens, monitoring of employment in the informal sector of the economy, the level of wages at enterprises located in municipalities, the financial condition of city-forming and large enterprises will contribute to increasing tax revenues of municipal budgets. Conclusion. In recent years, most municipalities have faced common problems such as insufficient tax revenues and increased funds allocated from higher budgets. Given that a significant share in the tax revenues of municipal budgets of the Russian Federation is the tax on income of individuals, it is advisable for individual entrepreneurs whose professional tax deductions are more than 94% in the income received to introduce a minimum tax, which will greatly contribute to an increase in tax revenues of local budgets.