Tax potential of regions and subsidies

A region's tax potential is the amount of taxable resources, the maximum amount of tax revenue that a region can earn with the efficient use of its available resources under current tax legislation. This indicator characterizes the level of a region's development and is used to analyze and forecast the level of revenue for regional and local budgets and to assess the financial significance of the region's economic activities. This indicator is crucial in regulating interbudgetary relations: based on its value, subsidies from the federal budget are allocated, which ultimately leads to increased regional budget revenues. The relevance of this study is due to the following: tax potential underlies differences in the level of socioeconomic development among regions. Many regions have low estimated budget capacity, which prevents them from fully meeting their expenditure obligations. Therefore, it is necessary to equalize the budget capacity of the constituent entities of the Russian Federation by providing appropriate subsidies. The purpose of this study is to examine the tax potential of regions, existing calculation methods, areas for increasing tax potential, the role of subsidies in equalizing regional budgetary capacity, and the results of equalization. Materials and Methods. The research base included Rosstat data on the per capita budget, subsidies for equalizing regional budgetary capacity, reports from the Federal Tax Service of Russia on the assessment and collection of taxes and fees in the consolidated budgets of constituent entities of the Russian Federation, and data from the Accounts Chamber on the results of equalization. The article utilizes the following methods: analysis and synthesis, grouping, generalization, tabulation, comparison, and others. The study found that existing methods for calculating tax potential have both positive and negative aspects, and none of them can be considered universal. The complexity of accurately calculating tax potential is due to the fact that many factors influence its value. The need to create a unified methodology for calculating tax potential is driven by the fact that the fairness in the distribution of subsidies for equalizing budgetary capacity depends on the accuracy of this indicator's calculation.