The current structure of municipal budgets, from 50% to 70%, central level funds, shows that municipalities mainly rely on central budget funds, neglecting their own revenue to implement their own local policies, said Minister Risto Penov. The presentation of reports from the State Audit Office on the topic "Own revenues of the municipalities in the context of the pandemic for providing quality services to citizens".
- The health crisis did not have a big impact on the delivery of local services, because most of them are financed with special donations from the central budget. Taxes showed that in the first quarter of 2020, compared to 2019, the municipalities had an average drop of 11% in revenue from their own sources. In the same period, the revenues collected by the central government, which are intended for the municipalities, increased - the general subsidy from VAT increased by 3%, and personal tax by 32%. The dialogue between the two levels of government for better revenue sources will continue, but at the same time, local governments will have to show greater effort and better results in collecting and implementing their own funds and spending them in an innovative way, which will encourage development and provide better services. In that sense, it is confirmed that in addition to the funds from the central budget, which the municipalities consider serious and justified, a greater fiscal effort is needed from their side to be able to implement their own local policies. Units of local self-government revenue and personal tax increased by 6% until 2024. This means that next year there will be another increase from the current 5.5 to 6%. – said the ministers.
The Minister of Local Self-Government emphasized that the municipalities have these funds at their own disposal, and the new quality is that part of these funds are now distributed in a correct way, according to the formula - one part for the municipalities with weaker fiscal capacity, and the other part for the municipalities that have shown better results in self-payment.
- I sincerely hope that the worst experience of the health crisis caused by the pandemic is behind us, but the lessons learned and recommendations are always useful and can be corrective, which will prevent the crisis caused by various factors, he added.
The Ministry of Local Self-Government in collaboration with UNDP has prepared three analyzes on the impact of the Covid-19 crisis on the functioning of local self-government, and the results are generally consistent.
Social services in the jurisdiction of the local self-government, kindergartens and nursing homes are covered by block grants from the state budget, as well as jurisdictions in primary and secondary education and fire protection. The main challenge in that period for the municipalities was the communal services, before the collection and disposal of solid waste and in that case the municipalities functioned at the usual level, without any delay in the delivery of the service. In terms of local utility charges, there are no major differences, but the data show that the municipalities that created the opportunity for electronic payment did better.
- With the support of USAID, we help the municipalities to strengthen their administrative resources for more efficient collection of their own income, which in the municipalities covered by the project already gave results - Kavadarci increased property tax collection by 100%, other municipalities have more payment in amount of 34.5%. Specifically, the municipalities of Shtip, Mogila, Kavadarci, Debar, Centar Zhupa, Kratovo have good results in terms of updating data and efficiency in the administration of property tax, thus increasing their own sources for independent financing of some jurisdictions that are not subsidy from the central budget, concluded Penov.