Budgets of municipalities as a financial basis for their economic security
Abstract. In the current economic conditions, characterized by increased sanctions pressure on our country, the urgent issues are the successful development of subjects of the Russian Federation, the territories of the country, the creation of mechanisms to counter external and internal threats and exports, which is impossible without the successful development of local budgets as grassroots links of the budget system. The most important and necessary condition for the successful development of territories is to increase the balance and sustainability of budgets at all levels, including local ones, which enhances the relevance of the financial security of local budgets by strengthening their revenue base, which ultimately ensures their economic security. The purpose of this research is to study possibilities of local budgets in ensuring the economic security. With the help of general economic research methods, the trends of changes in the number of municipalities, sources of income generation for local budgets in the whole country and in the context of federal districts, the dynamics of changes in debt obligations were studied. As a result, the tendencies of decrease in the share of own incomes with an increase in the share of gratuitous receipts, an increase in debts of local budgets are revealed. The author came to the conclusion that it is impossible to improve the financial condition of municipalities without a significant change in the fiscal mechanism. We are talking about re-fixing tax revenues provided by the Tax Code of the Russian Federation in favor of local budgets, which will lead to an increase in their financial independence, weakening their dependence on the federal center. The results of the study can be used in the selection of development areas of territories, the formation of fiscal policy.
Keywords: budget, municipalities, own revenues, tax and non-tax revenues, intergovernmental transfers, deficit, subsidies, municipal debt
Highlights:
♦ local budgets are one of the links of the country`s budget system; recently, there has been a tendency to reduce the number of municipalities, especially rural settlements, which is associated with their merger, unification due to the lack of a tax base on their territories;
♦ the financial problems of local budgets are related to the fact that the tax revenues of their budgets grow more slowly than the total amount of budget revenues, and therefore the share of inter-budget transfers does not decrease because of the inefficiency of taxes assigned to them; despite the subsidization, the ratio between the maximum and minimum values of per capita monetary income does not decrease (for rural settlements, the gap remains at the level of 28 times); the situation is complicated by the presence and increasing debt of municipalities, which at the beginning of 2021 amounted to more than 27% of the total revenue of local budgets;
♦ under the current fiscal mechanism, the share of local taxes is negligible, more than 2/3 of municipal budgets are formed at the expense of personal income tax, provided inter-budget transfers cover the deficit of local budgets, but do not stimulate their development in any way; the financial situation of municipalities will not improve without re-fixing taxes in favor of local budgets.
Nikolay Z. Zotikov - I.N. Ulyanov Chuvash State University, Cheboksary, Russia