Fiscal Mechanism Research Articles

Towards Greater Citizen Participation in Financing Public Cultural Institutions—Legal Barriers and Proposed Solutions

The paper contains a conceptual proposal that aims at indicating new models of participatory financing of cultural institutions as well as actions towards supporting culture. It presents results of a qualitative study in the form of action research, on identifying legal barriers of financing of cultural institutions in Poland. Additionally, it presents practical suggestions to the encountered problems that were worked out after discussions with cultural managers, taxpayers, and government administration decision-makers. The unique value of the study is a multidimensional and complex analysis of participatory financing of culture, citing varied sources and bearing a structured research procedure. We suggest a new discussion on establishing legal solutions for increasing of the funding or making the financing of cultural institutions more flexible, which appears to be particularly important in crisis times. All is presented as an original concept of participatory citizen-enterprise fiscal mechanism of supporting cultural institutions. We present a pragmatic solution to a problem of additional public support of culture, which can be put into practice parallel to state mechanisms, considering culture as a part of sustainable development.

Output-volatility reducing effects of automatic stabilizers: Policy implications for EMU member states

In this paper, we empirically explore the output-volatility reducing impact of automatic stabilizers and look in detail at their policy implications for selected EMU member states comprising Austria, Finland, France, Germany, Ireland, Italy, the Netherlands, Portugal, and Spain for the period 1995–2017. Overall, the results suggest that automatic stabilizers deliver a statistically significant, but fairly weak, counter-effect on output volatility in the short run. More specifically, output-volatility responses to automatic stabilizers by a reduction between −0.012 and −0.097 percentage points depending on the proxy measure used for automatic stabilizers. However, the automatic stabilizing impact from taxes and government spending is statistically insignificant in the long run. The results point to two main policy implications: i) automatic stabilizers are an important fiscal mechanism just for the short-run output stabilization, but their output-volatility offsetting role and power are largely subject to proxy measures used for automatic stabilizers; ii) no matter what proxy measures are used, automatic stabilizers largely produce a weak stabilizing performance in dampening short-term output volatility. So, from a macroeconomic policy standpoint, it can be safely claimed that automatic stabilizers can just be an integral part of discretionary fiscal policy rather than being an alternative to it.

Revisiting speculative hyperinflations in monetary models

This paper revisits the debate on ruling out speculative hyperinflations in monetary models. Although apparently a narrow issue, studying these extreme economies turns out to be quite illuminating in understanding the fundamentals of price level determination. It is also relevant in evaluating the broader claims that advocates of the fiscal theory of the price level have made. In Obstfeld and Rogoff (1983, 1986) we show that in pure fiat money models with rational expectations, where the government gives no backing whatsoever to currency, there is in fact no reasonable way to rule out speculative hyperinflations where the value of money goes to zero, even if the money supply itself is exogenous and constant. Such perverse equilibria are ruled out, however, if the government provides even a very small real backing to the currency – a fiscal mechanism, but one that comes into play only as a backstop. Indeed that backing does not have to be certain. Cochrane (2011, 2019), however, argues that this result is wrong, and that fractional currency backing is a Maginot line that is insufficient to rule out hyperinflation. We show here why, in fact, his analysis involves a subtle change in model specification that adds a distinct monetary fragility to our model. Our baseline analysis uses a canonical money-in-the-utility-function setup due to Brock (1974, 1975), but following Wallace (1981), we show the same results go through in an overlapping-generations model of money.

Fiscal Responsibility Legal Framework—New Paradigm for Fiscal Discipline in the EU

This paper aims at studying the legal aspects of the European Union (EU)’s fiscal policy, analyzing the statute of fiscal responsibility legal framework, the different measures undertaken in the last years with respect to European trends in fiscal governance and their implications for challenges in public finance sustainability. The research started from the presupposition that there is a lack of mechanisms capable of enforcing the area of public finance sustainability, and the implication of the events that created the economic conjuncture of recent years reveals that the solidity of public finances has reached an impasse and needs to be enhanced. The analyzed documents from the area of fiscal responsibility show formal respect for the legislative framework aimed at consolidating public finance sustainability and accentuate the need to use fiscal laws, independent institutions and mechanisms that put constraints on policymakers and determine them to spend more efficiently, invest more wisely, and obtain better results regarding public finance sustainability. We conclude that future policymaking processes need to consider the consolidation of independent fiscal institutions founded by Fiscal Responsibility Law framework, completed by fiscal rules and, therefore, need to redesign the fiscal risk management process.

Obstacles to the development of workplace health promotion in Poland - the perspective of companies' representatives

The aim of the paper is to present the barriers and difficulties faced by companies in Poland in their employee health promotion activities. The aforementioned obstacles were analyzed in terms of their quantity and quality. Quantitative data come from 5 nationwide surveys conducted in 2000 (N = 755), 2006 (N = 611), 2010 (N = 1002), 2015 (N = 1000) and 2017 (N = 1000), in companies employing ≥50 people. Qualitative data were collected from representatives of such companies by means of an audience survey conducted during a conference (N = 75), 8 focus group interviews (N = 64) and individual in-depth interviews (N = 14). Invariably, the most frequently reported difficulty has been the shortage of financial resources for health promotion, as well as the lack of real support (legal, fiscal) from the government. By 2017, the former was indicated by 53% of companies, and the latter by 48%. A detailed analysis has shown that they are interrelated, and the key barrier is the mentality of employers and managers, i.e., their reluctance to health promotion, the fact that they are convinced of its high costs, a poor knowledge about its importance and implementation methods, and fear of the unknown. Other difficulties include: culture and work organization not fostering health care, a poor preparation and limited opportunities for the staff to implement health promotion, employees' reluctance to employer's health-related activities, some drawbacks of offers addressed to companies by external service providers, and, to a lesser extent, other difficulties arising from the business environment. To effectively mitigate these barriers, it is necessary to involve the government in the implementation of a coherent strategy to support health promotion in companies. Its main directions would be: shaping employers' awareness, supporting health-related activities through fiscal mechanisms (tax and insurance), educating the managerial staff, and pursuing effective cooperation with external providers of health services for employees. Med Pr. 2020;71(5):569-86.

The Taxation Mechanism for Income Obtained from Foreign Currency Rental Contracts

The present article discusses a series of theoretical and practical aspects regarding the fiscal mechanism for taxation of income obtained by natural persons tax payers through a maximum number of five foreign currency rental contracts.

Challenges for the Island of Barbuda: A Distinct Cultural and Ecological Island Ecosystem at the Precipice of Change

Barbuda is one of two major islands that comprise the Caribbean nation of Antigua and Barbuda. The island is known for its secluded pink and white sand beaches and, more recently, for Hurricane Irma (September 2017). The category five mega-storm decimated much of the island’s landscape and infrastructure, and the physical damage was widely publicized. Three years after Hurricane Irma, many challenges related to humanitarian aid, fiscal resources, and materials to rebuild remain. There are many natural resource commodity and human social challenges including those related to water resources, agriculture, marine ecosystems, feral animal populations, human health, tourism, and economics. This article includes some of Barbuda’s historical context and identifies a number of current critical challenges and recommendations for activities (approaches) that may advance a number of management practices. For example, the Integrated Watershed Management (IWM) and/or One Health approach(es) include social and fiscal mechanisms to implement programs, policies, legislation, and research in which multiple sectors of Barbuda could communicate and work together to achieve sustainable outcomes. Context is provided to substantiate humanitarian aid, scientific engagement, scientific progress, and political support for a semi-closed cultural socio-ecological island ecosystem at the precipice of change.

FISCAL COMPONENT OF CRYPTOCURRENCY LEGALIZATION IN UKRAINE

Introduction. The digitalization of the financial sector leads to the transition to blockchain technology, which opens up additional opportunities for expanding the financial base of the state through fiscal mechanisms, and generates additional risks. That is why the topic of taxation of the digital sector is now being addressed both at the governmental level and by a number of scientists and crypto enthusiasts.The relevance of the topic presented in the article is determined by the need to determine the legal status and legalization of cryptocurrencies in Ukraine in the system of modern payment and exchange transactions. Methods. Methods of analysis of foreign taxation practice and regulation of cryptocurrency circulation and determination of tax base are used in the process of preparing the article, as well as approaches to interpretation of cryptocurrency from the positions of goods, property, digital financial asset, intangible asset. Results. The results of the study showed that Ukraine has approaches that are based on domestic legislation, or rather its opportunities for expansion in order to conceptually adopt the cryptocurrency industry in the current legal field, and to study foreign experience and practice of leading countries that are already taxing transactions with cryptocurrencies on the general principles of tax legislation, or create privileged conditions in the form of reduced rates or a preferential tax period. Discussion. The difficulty is to find a balance of interests between the state and the user of cryptocurrencies, and it is essential to determine the status of legalization of digital financial assets and digital currencies for the digital economy, which will expand infrastructure and ecosystems in cryptocurrency projects. And scientific approaches will allow to integrate them into the economic system of the country. Keywords: blockchain, cryptocurrency, cryptocurrency, digital goods, taxation, legal status, tax norms

ВОПРОСЫ ЭЛАСТИЧНОСТИ НАЛОГОВОЙ СИСТЕМЫ АЗЕРБАЙДЖАНА В УСЛОВИЯХ ГЛОБАЛИЗАЦИИ

The article presents materials of theoretical and empirical research on important elements and components of the state regulation system, in particular, on the country’s tax system. The main functions and significance of the elements of the country’s tax system, and their effectiveness in increasing the transparency of tax mechanisms are considered. Attention is drawn to the theoretical and methodological foundations and approaches to the formation of an adequate tax policy of the country, taking into account globalization and new challenges. The coefficient of elasticity of taxes in Azerbaijan for 2010-2018 was calculated, reflecting the degree of dependence of income from taxes in relation to changes at the macroeconomic level and associated with the efficiency of the functioning of the entire state as a whole. The importance of improving the existing approaches and principles of state regulation in the direction of improving the mechanisms of the tax system is substantiated. The need to update the existing fiscal instruments, taking into account the priority goals and objectives of the country’s tax strategy, was emphasized. The importance of accelerating targeted measures to ensure maximum transparency of the tax environment is disclosed and argued. The principal approaches and criteria for increasing the responsibility of taxpayers have been studied and summarized. Possible directions of ensuring the growth of tax revenues to balance the income and expenditure side of the country’s budget are analyzed. A number of important criteria for stabilizing the economy through tax mechanisms are noted: diversification of the tax base; modernization of practiced fiscal mechanisms and instruments; improvement of fiscal components in accordance with new challenges. The study examined the key issues of increasing the efficiency of government regulation in the tax area. The priority tasks of the fiscal authorities and the importance of strengthening the activities of the country’s tax services in the context of the global coronavirus pandemic are described. Suggestions and recommendations were given on the issues of improving the tax system of Azerbaijan in modern conditions.

Crime, different taxation, police spending and embodied human capital

AbstractWe develop a model with crime, embodied human capital, police spending and three different taxation. Based on propositions examined analytically, numerically and empirically using a cross‐country panel data on crime, we contribute to the literature by identifying a positive crime‐labor income tax nexus and a negative crime‐capital income tax nexus. The opposite effect between labor and capital income taxation on crime is novel in the literature. We also document positive association between crime and consumption tax, which suggests that apprehension probability (a proxy for the effectiveness of criminal justice system) is endogenous to fiscal mechanism. These findings have potential policy implications in that, there is a potential role for dedicated tax instruments to be used in supporting conventional crime prevention and deterrence policies.

Макроекономічний вимір фіскальної політики в умовах розгортання глобальної кризи

Fiscal policy in the context of global crisis has been analyzed in the article. With the appearance of global crisis processes, threats and macroeconomic imbalances arise, which inevitably lead to a decline in production, shortages of financial resources and a slowdown in economic development in general. Only an effective fiscal policy can ensure the formation of the state budget and the optimal use of expenditures for long-term economic growth and improving welfare of population. Relevance of the article is justified by the fact that fiscal policy in Ukraine today requires new approaches that would be based on the experience of foreign countries and would take into account peculiarities of the domestic economy. The purpose of the study is to analyze current trends in the implementation of fiscal policy in Ukraine, to identify ways and directions aimed at creating effective fiscal mechanisms focused on European norms and standards. The authors analyze dynamics of budget indicators for the period of 2015-2020 on the basis of statistical data. The analysis allows us to conclude that in this period there is a tendency to exceed the volume of state budget expenditures over revenues, which leads to a threatening increase in budget deficit and public debt. Considerable attention is paid to the study of foreign experience. Based on the analysis, it was found that to solve the problem, governments pursue fiscal policies aimed at reducing budget expenditures and increasing the tax burden on the economy. The analysis allows us to conclude that coordination of fiscal mechanisms needs to be improved and strengthened in order to reduce the gap between expenditure and revenue budgets, counter the threats of the global crisis and achieve common goals. The economic strategy of state should be aimed at improving capacity of existing and finding new fiscal mechanisms using world experience.

Results of research of the reduced emissions of pollutants by road vehicles of various environmental classes "Euro" as the basis of environmental hazard labeling

This study analyzes the change in the calculated reduced emissions of pollutants by all major categories of road vehicles of European environmental classes from "Euro-0" to "Euro-6". It covers cars, light commercial vehicles, trucks, buses, and category L vehicles (mopeds and motorcycles). The reduced mass emissions of pollutants are defined in a common coordinate system, from both traditional internal combustion engines and electric vehicles. Emissions in atmospheric air by wearing products of a pneumatic tire, road pavement, and brake pad are also taken into account. The methodology for calculation of reduced mass operational emissions includes 64 types of major pollutants, grouped into eight specific groups. Carbon monoxide, carbon dioxide, nitrogen oxides, nitrous oxide, ammonia, light hydrocarbons, aldehydes, ketones, aromatic hydrocarbons, polycyclic aromatic hydrocarbons, persistent organic pollutants, particles, sulfur compounds, metals, are covered. Particulate matter emissions from engine exhaust, pneumatic tire wear, road pavement, and brake pads are taken into account. Particulate matter emissions include both elemental carbon and individually adsorbed and absorbed carcinogens in their composition. The average operational mass emissions of pollutants were determined using the methodology of the European Environment Agency. For each of the 64 pollutants, a relative toxicity (aggressiveness) factor is proposed. It is based on available data on the maximum permissible concentrations of substances in ambient air. It is determined as the ratio of the maximum permissible concentrations of carbon monoxide to a known pollutant. It was found that the reduced emissions by cars of level "Euro-5" and "Euro-6" with gasoline engines are only about four times higher than the reduced emissions of electric vehicles; the reduced emissions of "Euro-6++" cars with diesel engines are twice as high as those of "Euro-5" or "Euro-6" cars with gasoline engines; the reduced emissions of trucks and city buses of "Euro-6" level are on average only about five times greater than the reduced emissions of electric transport; the reduced emissions by vehicles of category L (mopeds and motorcycles) can significantly exceed the emissions of cars and even buses and trucks. The results obtained could be the basis for the development of environmental (ecological) classification and labeling of road vehicles. It provides opportunities for the introduction of fiscal and other mechanisms to encourage the use of more environmentally friendly vehicles in line with the practice of EU Member States, using the "polluter pays" principle. General principles of the introduction of the universal system of road vehicles' environmental hazard labeling are proposed. It is suggested to set discrete baseline levels of environmental hazard in increments of 1.259 times the reduced emissions, which is equal to an increase by 100.1 times in the specific energy value, that is, 1 dB

The Impact of Fiscal Policy on Aggregate Economic Activity: A Regime Dependent Impulse Response Analysis

Asymmetries in fiscal policies cannot be captured by linear time series models. In order to examine the asymmetry responses of output in different phases of the business cycle, Markov Regime Switching (MRS) model is an alternative technique that is used to achieve the objective. The main objective of this study is to empirically explore the effects of fiscal shocks (spending and taxes) on Pakistan’s overall economic activity GDP while utilizing Markov Switching MS-VAR model. The model is characterized to allow for the variation in mean, coefficients and in error variances. The study results show that the effect of shocks and the size of multiplier varies across regimes confirming the asymmetric behavior of fiscal policy transmission mechanism. Moreover, the impact of positive spending shock has a stronger effect on output in the recession as compared to boom. One surprising result of the study is that the tax shock increases the output both in recession and boom. Lastly, spending and revenue behave a-cyclically.
 JEL Classification Codes: C11; C32; E62

The impact of tax and budget policy on the level of economic growth

Relevance of the research topic. In the current conditions of development of social relations, the issues of increasing the validity of fiscal policy, using its regulatory potential for the proper fulfillment of tasks and functions entrusted to them by state bodies and local self-government bodies are actualized. An important task of fiscal policy is to improve its instruments aimed at accelerating economic growth. At the same time, the peculiarities of the formation and implementation of fiscal policy in both the advanced and transformational economies are conditioned by a number of factors, the most important of which are: the level of economic growth and institutional capacity of the country. Formulation of the problem. Based on the transformation processes in the domestic system of public finances, the major tasks are: the reconciliation of fiscal policy with the strategic task of socio-economic development of the country, improving the architecture of budget revenues and expenditures; ensuring the concentration of limited budgetary resources in those sectors of the economy that will facilitate the acceleration of economic growth, which requires further scientific studies of theoretical and applied aspects of fiscal policy formulation and implementation, assessment of its impact on the level of economic growth. At the same time, the choice of fiscal policy instruments should be made taking into account the cyclical and dynamic economic processes. Analysis of recent research and publications. The problems of forming and implementing fiscal policy are quite common in scientific research. These are the works of well-known domestic and foreign scientists: J. Buchanan, W. Mitchell, J. M. Keynes, T. Bogolib, I. Zapatrina, L. Lisyak, I. Chugunov and others. Highlighting unexplored parts of a common problem. The aforementioned issues are updated due to the increasing globalization processes, the unfavorable external and internal economic environment, which requires a number of specific tasks related to the development of fiscal policy. Goal setting, research goals. The objectives of the study are: to reveal the nature and role of fiscal policy in ensuring economic growth, to substantiate the features of fiscal policy in the current conditions of development of the public finance system; to analyze and evaluate the consolidated budget revenues and expenditures; identify the main factors that influence the peculiarities of fiscal policy implementation; to open up provisions for improving the efficiency of the fiscal policy regulatory mechanism. The purpose of the study is to substantiate the priorities of fiscal policy of economic growth in the context of institutional transformation. Research method or methodology. The set of methods of scientific research is applied in the article: systematic approach, statistical analysis, structuring, analysis, synthesis, etc. Basic material presentation (results of work). The essence and role of fiscal policy in ensuring the economic growth of the country are determined. The consolidated budget revenues and expenditures have been analyzed and estimated. The priorities of fiscal policy of economic growth in the context of institutional transformations are substantiated. Area of application of results. The results of this study can be applied in the process of forming and implementing fiscal policy of Ukraine, reforming the public finance system. Conclusions according to article. Fiscal policy is a dynamic system of goals, directions and tasks of public authorities and local self-government aimed at ensuring the stability, stability and balance of the budget system, further improving the institutional environment of budgetary relations, taking into account the cyclical and dynamic economic processes. Developing an effective fiscal policy involves developing a structural and functional model of fiscal policy that is based on the integration of institutional components of the budgetary space. Assessment of the impact of fiscal policy on economic growth should include a detailed analysis of the architecture of budgetary indicators, as well as an assessment of possible risks. In modern conditions of development of social relations the important tasks of fiscal policy are: optimization of the level of tax burden; improvement of the architectonics of budget expenditures (a significant share of budget expenditures goes to consumption); improving the architecture of budget revenues, in particular by changing the relationship between indirect and direct taxes; raising the level of the regulatory function of fiscal policy, in particular by supporting the development of major sectors of the economy. The article identifies strategic priorities of fiscal policy of economic growth in the context of institutional transformations.

Детермінація методів фіскального механізму регулювання інвестиційного розвитку національної економіки

In market conditions, one of the main regulators of economic development is the financial mechanism, a key element of which is the fiscal mechanism for regulating the national economy investment development. Currently, the methods of the fiscal mechanism are not used effectively enough in Ukrainian practice, as evidenced by the low investment attractiveness of the economy and weak investment activity of economic entities. Therefore, the definition of the essence and components of methods of the fiscal mechanism is currently among the important financial and economic issues, the scientific substantiation of which largely depends on the economy investment development. The article is devoted to the study of theoretical approaches to the functioning of the methods of the financial mechanism and on this basis to determine the content and composition of the methods of the fiscal mechanism. It was determined that there are various approaches to understanding the essence of financial methods (as means, forms, methods, rules) and three conceptual approaches to the interpretation of the methods of financial mechanism: management (considers the methods of financial mechanism as processes in which implementation of financial policy); organizational (treats the methods of the financial mechanism as a means of organizing financial relations, which are formed in the process of implementing financial policy); complex (characterizes the methods of the financial mechanism as a process of organizing financial relations to achieve the objectives of financial policy). As a result of research of theoretical bases of functioning of financial methods the essence of methods of the fiscal mechanism of regulation of national economy investment development was substantiated. The main methods of the fiscal mechanism were identified, including planning, organization and control. The basic requirements to functioning of methods of the fiscal mechanism of regulation of the national economy investment development were considered.

Shaping the prospects for adequate pensions: the effect of policy guidelines under the European Semester

ABSTRACT This paper depicts the relationship between the EU and pensions by demonstrating the EU’s indirect pressure on pensions – spill-over from the Economic and Monetary Union (EMU) – reflected through economic and fiscal policy coordination mechanism. Concretely, the paper examines how compliance with the fiscal and economic policy guidelines deriving from the European Semester shape prospects for pension adequacy in the euro area countries. Pension adequacy is understood as the ratio of available income in retirement relative to available income during employment. The results point to three empirically relevant economic-fiscal policy models/configurations under which adequate pensions are observed. The models are not universally based on compliance with the policy guidelines under the Semester and they differ in terms of the type of policy which is potentially conducive for adequate pensions. Diversity of the models thus implies that compliance with the guidelines works for some euro area countries whilst for others it does not. Consequently, the shaping prospects or the safeguarding capacity of the Semester’s policy guidelines in terms of adequate pensions are modest. The main method used in the paper is fuzzy-set qualitative comparative analysis (fsQCA).

Fiskalni menadžment i politički budžetski ciklusi u tranzicionim ekonomijama - analiza panel podataka

In this paper, on the basis of relevant statistical tests, the influence of the electoral process on the trajectory of fiscal indicators in the transition countries is analyzed. The aim of the research is to identify the political manipulation of certain fiscal policy mechanisms in transition countries.The focus of the survey is on the growth of general government spending, the reduction of general government revenues and the creation of budget deficits as the coherent consequences of fiscal expansion in the pre-election period. By testing, there is no relevant evidence of the use of tax incentives as a form of political action on the economic sphere. On the other hand, the results of the survey indicate that in the observed countries, there really is a rise in government spending in the period before the election process and, consequently, the growth of budget deficits. However, according to the same findings, in the post-election period there is no reduction in consumption. Growth in general governments consumption continues, but to a lesser degree, which in turn leads to the correction of the budgetary balance.

ПОЛІТИЧНА ЕКОНОМІЯ ПЕРЕБУДОВИ ГЛОБАЛЬНИХ ЛАНЦЮЖКІВ СТВОРЕННЯ ВАРТОСТІ

The article analyzes the international production of multinational enterprises (MNEs). It presents some theoretical approaches to the analysis of international production, such as fragmentation theory, global value chains (GVCs) theory. The article argues that at the present stage of the world economy internationalization, there are two trends in the localization of MNEs global chains. The first trend indicates a slowdown of GVCs growth in the last seven years. The second trend characterizes the restructuring of GVCs. It indicates the backward movement of certain international production fragments to the MNEs home countries. Among the major factors that have slowed the growth of international MNEs production, the article analyzes the political instability and low economic dynamics of some FDI exporting countries. Changes in the location of global value chains are driven by technological, economic and geopolitical factors. Fourth industrial revolution, the robotization of production and new technologies for shale oil and gas in the US are changing the traditional determinants for GVCs localization. They have caused the relocation of many businesses from countries with the cheap labour to MNEs home countries. The article also highlights that the important factors of GVCs restructuring are the fiscal mechanisms implemented by the US administration, including tax reform. But the short-term and long-term effects of such measures differ significantly. Finally, the third important factor in the dynamics and restructuring of multinational enterprise network production is the geopolitical risk and political uncertainty. The trade war between the US and China has had a particularly significant impact on the current global value chains rebuilding.

Меры налогово-бюджетного стимулирования экономического роста территорий

Two possible directions of fiscal measures aimed at improving Russian territories’ economic development are discussed in the paper: one at the level of largest agglomerations and another one at the regional level. It is widely accepted that agglomerations are “engines” of economic growth. The Strategy of Spatial Development of the Russian Federation until 2025 pays special attention to the development of agglomerations. However, the latter process has not only natural limitations, but also institutional ones arising from low fiscal independence of municipalities which form agglomerations. To overcome the institutional limitations, the paper proposes a set of fiscal measures, including a redistribution of tax revenues and expenditure obligations between the center of a given agglomeration and the region that contains it. The current fiscal mechanisms of stimulating economic development of Russian regions are analyzed. A mechanism of additional stimulation for regions to develop their own revenue base is proposed; it includes the transfer of receipts of VAT levied with a reduced rate of 10 % to regions in exchange for centralization of some part of corporate income tax in the federal budget. Different scenarios of this exchange are analyzed. It is shown that centralization of the corporate income tax amount corresponding to the 1 % rate in the federal budget in exchange for the transfer of VAT levied with a rate of 10 % to regions with a compensation mechanism within the transferred amounts is neutral to the federal budget and to budgets of the regions which receive equalization grants.

Regulatory role of taxes in formation of incomes of various levels budgets in the Russian Federation

In this article, we conducted a thorough analysis of the formation of various levels budgets over a long period (from 2003 to 2017 for the federal budget, from 2008 to 2017 for consolidated budgets of the Russian Federation subjects), revealed the insignificant role of taxes assigned to individual budgets in budget revenues, a weak regulatory function of taxes, especially in the budgets of the Russian Federation subjects and municipalities, in budgets of which the role of uncompensated receipts prevails. The study showed a highly financial dependence of the regions and municipalities on the federal center. Held for the period from 2011 to 2017 the rating showed a sharp differentiation of regions in terms of socio-economic development. Deficit characterizes both the federal budget and the budgets of regions and municipalities, which is primarily due to the imperfection of the existing fiscal mechanism in the country.