Stimulating system of budgetary equalizing of territories

The acute problem of the budgetsystem of the Russian Federation is horizontal and vertical disbalance. The world experience and Russian practice prove the necessity offurther institutional transformation on the way of building federal, democratic, social and economically effective state. The necessity ofstimulating horizontal equalization is caused by the problem of underproduction of public welfare in separate territories, therefore itssolution consists in formation of a system of interbudgetary support; its purpose is to increase the budgetary incomes of territories withinsufficient tax potential or raised costs for manufacture of public welfare, providing the necessary increase in their volume. Thus, theproblem of settlement of relations of the state and taxpayers can be solved by interbudgetary financial streams, in particular, through thesystem of transfer of financial assets from the federal centre to the needing subjects of the Federation or from more provided subjects tothe less provided ones. It explains the importance of such a tool of horizontal equalization as transfers. The policy of budgetary equalizationis impossible without direct or indirect redistribution of means and the rights from rich regions to the poor ones. Thus, scales ofsuch redistribution should be sufficient for development of poor territories, but not blocking the development of the rich. Withdrawal ofessential sums of money from incomes of the rich regions will reduce their stimulus to economic growth. Simultaneously, unreasonablyhigh increase of budgetary incomes and incomes of the population of the recipient regions can lead to dependence tendencies. In otherwords, in the course of equalization a compromise between the loss of manufacture stimulus of the donor regions and the threat of economicand social destabilization in the regions with low economic potential is necessary. Therefore, realization of similar distribution ispossible only through the federal budget. Thus, in a federative state budgetary equalization as a conceptual component of budgetaryfederalism has distinctive features caused by its specificity in the field of relations of the federal centre and the regions. Irrespective ofthis specificity any model of budgetary federalism starts with the idea of whether it is possible to maintain a certain minimum of publicwelfare granting in all the countrys regions at the expense of a uniform budgetary-tax policy. The system of intergovernmental relationsis to provide redistribution of revenue of the state between different subjects considering their tasks and powers, and expenditures connectedwith them. The sum of compensation payments is ranged according to the rate of income in the territory and the coefficients oftaxes and compensation assignments. The system of intergovernmental relations depends on the federal state order. One can state thateach type of federalism corresponds to a definite type of financial constitution. So, building a democratic, federal state with sociallyoriented market economy is the most important institutional condition to form a balanced and effective system of intergovernmentalrelations.

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