Dzhuryk Kh., postgraduate student of the Department of Finance, National University «Lviv Polytechnics», Lviv, Ukraine

e-mail: dxb180987@gmail.com
ORCID ID: 0000-0002-7100-8128

Foreign Experience of Local Government Financing

Abstract. Introduction. Over the recent years the fundamental changes in the system of local self-government have undergone in Ukraine, particularly as regards the formation of local budgets. A range of laws were adopted to increase the budgetary autonomy and financial self-sustainability of local budgets, namely: self-formation of local budgets on the basis of fixed stable sources of income and expenditure powers and key parameters.

Purpose. The purpose of the article is to develop the theoretical basis for research on the experience of reforming local self-government in such countries as Poland, Kazakhstan, Japan, and the possibility of its use in reforming the territorial organization of power in Ukraine.

Results. An example to follow should be the experience of Japan, meaning that it is necessary to reduce the total amount of taxes, which will increase the efficiency of their administration, to expand the list of local taxes. Local taxes should include taxes which receipts would be significant and permanent, such as the personal income tax. One should recognize the link between services provided at the local level and the costs necessary to provide such services.

Conclusions. Тhe general strategic direction in Ukraine should be to increase the interest of local authorities in increasing the role of their own budget capacity while filling local budgets. It is necessary to take the necessary steps immediately so that Ukraine could gain more autonomy in the future in terms of revenue, forming a revenue base for local budgets, at the stage of instability and insignificance of its own sources of revenue, the role of state grants and subsidies should not be limited, since only in this way the state can actively effect the development of the local government.

Keywords: local government; finances of local self-government; decentralization; association of territorial communities.

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