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Verkhovna Rada to allow communities to be financially independent of districts

Source : 112 Ukraine

All 1,470 territorial communities, areas of which have been approved by the government, will switch to direct inter-budgetary relations with the state budget
16:36, 15 July 2020

Verkhovna Rada of Ukraine
24 Channel

Verkhovna Rada upheld as a basis the bill №3614, which will allow communities to be independent from the districts. 320 MPs voted for the decision.

112 Ukraine TV channel broadcasted the session.

The bill stipulates that budgets of villages, towns, cities will no longer depend on the district. All 1,470 territorial communities, the areas of which have already been approved by the government, will switch to direct inter-budgetary relations with the state budget.

The document stipulates that revenues and expenditures of the budgets of districts will be differentiated from territorial communities. It is proposed to exclude district budgets from the system of horizontal alignment, which means district budgets will not receive a basic subsidy and will not be in direct inter-budgetary relations with the state budget.

District budgets will be formed from: its own revenues (corporate income tax from the communal property, the founder of which is the District Council; payment for licenses and certificates of economic activity issued by District State Administrations; rent for the use of the communal property and other income;) and subsidies and subventions that can be sent from other budgets.

The budgets of 1,470 territorial communities, in accordance with the current budget and tax legislation, will transfer to direct inter-budgetary relations with the state budget. Among the main revenues of these budgets:

personal income tax 60%;

local taxes and levies;

rent payments;

excise tax;

income from communal property;

payment for administrative services;

transfers (subsidies, subventions), etc.

This way, all 1,470 territorial communities will be independent - district authorities will not have any administrative and financial influence on them.

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