PROBLEMS OF FORMATION OF TAX REVENUES OF THE BUDGET OF TERRITORIAL UNITS AND WAYS OF IT OVERCOMING

Economic strength of territorial units is one of the most important factors for the economic development of the government. And for the economic stability of the territorial units it is crucial to have high level of financial decentralization and the ability to provide their budget revenues with their own tax sources, which is guaranteed by effective fiscal politics from the government. Some reforms have been going on in Georgia for decades in order to have financial decentralization and to improve the quality of budget independence, but in order to improve modern situation in this field it is necessary to develop a system of specific actions. Therefore, the problem of tax revenue optimization of territorial units is gaining more urgency and we believe that identifying the factors hindering the improvement of the tax revenues of the budget of the territorial units and taking certain actions and measures to solve them will significantly contribute to the socio-economic development of the territorial units. While working on these issues, the study of the problem was done mainly using characteristic and quantitative research methods. In terms of characteristic research we managed to get information in-depth about the main topic and then we managed to process and analyze this information. In terms of quantitative research, we were mainly guided by statistical information of the revenues of the budgets of the territorial units. Quantitative data were processed in accordance with the objectives, on the basis of which specific trends of the problem were identified. Based on the analysis of the information collected through the mentioned methods, the relevant conclusion-recommendations were formed. The issue of ownership of natural resources is important for the economic development of territorial units. Natural resources should be used in such a way to maximize the growth rate of economic development of territorial units. Part of the value added that is created as a result of industrial-economic relations using natural resources should be transferred by using the budget-tax mechanism to the budget of the municipality and/or, as it is in our case, the budget of the Autonomous Republic. Clearly, the same principle must be maintained in terms of the use of other industrial resources. Effective use of fiscal policy instruments can create a structure of tax revenues for the budgets of territorial units, the volume of which will depend on the efficient use of resources in the territorial unit.