Features of inter-budgetary relations in the conditions of decentralization of power in Ukraine

Abstract

The article examines the features of inter-budgetary relations in the context of decentralization of power as an important tool for the formation of local budgets and their effective implementation with limited financial resources. The authors considered the factors influencing the decentralization process such as the taxation system, transfer policy, giving greater powers to local governments in developing programs of socio-economic development and analyzed the sources of financial resources of the region, problems of their formation and use, revenues and expenditures last years. Decentralization reform has made it possible to increase the revenue side of local budgets and strengthen the financial and resource base of the regions, improve the use of intergovernmental transfers and diversify their sources. The study revealed the main problems of formation and use of financial resources of the region. These include inconsistencies in the movement of financial resources, tax pressure, various goals of economic entities and public authorities, low level of financial literacy of local government officials, inconsistencies in budget legislation, and lack of an effective mechanism for redistribution of state revenues. Among the ways to conduct budget decentralization and ensure the effectiveness of inter-budgetary relations, based on expanding the rights of local governments, strengthening their budgetary independence and responsibility, it is proposed to provide local authorities with opportunities for budgeting, redistribution of financial resources between public authorities, clear definition of local government and united territorial communities, application of modern methods of social planning, mechanisms of interaction of public authorities, enterprises, the attraction of investment resources through the development of local funds of regional development, granting to investors advantages, support of cooperation and interaction of enterprises, reduction of expenses for maintenance of public authorities, expansion sources of revenue to local budgets. The processes of fiscal decentralization must be constantly improved by overcoming the contradictions that arise in intergovernmental relations and modernizing the main institutions of the budget system.