INTERBUDGETARY TRANSFERS IN THE REVENUE SYSTEM OF LOCAL BUDGETS: EXPERIENCE OF UKRAINE

The article examines the place of interbudgetary transfers in the formation of revenues of local budgets of Ukraine for the period 2001 – 2023 years. It is shown that the significance of the specified component in the system of revenues of local budgets in Ukraine ranges from 27.2 to 59.1%. Differences in filling the revenues of separate budgets, budgets of various groups and budgets of territorial communities by regions of Ukraine with interbudgetary transfers have been demonstrated. A change in approaches to the organization of interbudgetary transfers in Ukraine was recorded: from the provision of transfers from the state budget to a limited range of recipient budgets (until 2002) to direct relations with the main budget of the country covering all local budgets (from 2021). The role of regional budgets in fulfilling the role of distribution points through which transfers from the state budget reach the budgets of lower levels is noted. The importance of the correct calculation of budget revenues, as well as the absolute and relative indicators of interbudgetary transfers with respect to budgets involved in the transit of funds, in order to prevent distortion of the real state of budget execution, is emphasized. The consequences of the mentioned impact of transit transfers on budget indicators are demonstrated using the example of the budget of the Dnipropetrovsk region. Changes in the composition and structure of interbudgetary transfers are outlined, and an explanation of their causes is given: a change in approaches to equalizing the tax capacity of local budgets; the introduction of new rules for financing expenditures on education and health care; the refusal to finance state social protection programs through subventions from the state budget and the transition to direct (from the main budget of the country) tranches to direct recipients of funds; the introduction of new transfers for the purpose of implementing programs for the construction, reconstruction, repair, and maintenance of highways; as well as the transfers forced by wartime conditions, the so-called “military” transfers. The most significant interbudgetary transfers for the budgets of various groups are identified. It was concluded that a number of unresolved problems regarding the use of interbudgetary transfers remain in Ukraine, and their solution should be directed toward finding and justifying ways to further improve the system of horizontal equalization of the tax capacity of local budgets, increasing transparency in the provision of transfers through the wider use of formula-based calculations grounded in clear and unambiguous criteria for the distribution of funds, as well as the gradual rejection of transfers assigned manually.