Moldovan government has approved the draft law on the Balti municipality statute, which provides for a new mechanism for collecting local taxes.
This legislative initiative, developed by MPs from the ruling party PAS, received a positive opinion from the Cabinet, and provides that the Balti state administration will be reinforced and local taxes will be collected on the basis of a new mechanism. According to the draft law, Balti Municipal Council and Balti City Hall will be able to undertake a series of actions that will strengthen the capacity of municipal public administration, its relations with the local public administration within Balti municipality (Sadovoe and Elizaveta) and with municipal public utilities, which will give an impetus to the development of the region as a whole. It is also proposed to introduce the delimitation of powers of the mayor, in particular his own powers and delegated ones. Thus, the delegated ones should be financed from the state budget, and his own powers - from the local one. This distinction will allow ensuring full financial support and implementation of all powers of local public administration. Another proposal concerns the creation of a separate mechanism for collecting local taxes. Currently they are collected by tax authorities, which, according to the authors, have not demonstrated the required amount of collections. Accordingly, with the adoption of this law, it will be necessary to amend other normative acts, including the Law on local public finances, in order to consolidate public finances for the proper functioning of the Balti public administration. The authors of the draft law mentioned that currently Balti municipality is functioning without a statute that would regulate the specific features of organization and functioning of the local public administration authorities related to it. For these reasons, many bodies of municipal administration are non-functional, and the relationship between the municipal and local bodies that are part of it is unclear. The approval of the draft law elaborated by the PAS MPs will allow the Council and the Mayor of Balti municipality to undertake a series of actions aimed at consolidating the capacity of the municipal public administration, its relations with the local administration from the municipality, as well as with the public municipal services, and contribute to the development of the region in general. At the same time, the envisaged provisions in terms of budgetary-financial system will ensure the municipality of Balti with efficient management of financial policies for the implementation and development of public services. As noted by the authors of the draft law, the structural change since 2015 in the sources of local budget revenues, the exclusion of the Balti municipal budget from the system of receiving general transfers has led to a real reduction in the powers of the Municipal Council. The main budget-forming revenue sources, such as corporate income tax and more than 50% of personal income tax, are centralized at the state level. As a result, the guaranteed rights of local public authorities to own real capacity to perform their own and delegated powers to provide local public services to the population are reduced to a minimum. As noted by the authors of the draft law, in order to ensure their own powers to provide public services, an appropriate financial base is necessary. In this regard, in order to ensure full administration of local taxes and fees by the Balti municipality, it is planned to make relevant changes into the sections of the Tax Code. In particular, it is planned to envisage the transfer of local tax administration functions (section VII of the Tax Code) from the tax authorities to the relevant department within the Balti municipality, including: land improvement fee, fee for organizing auctions and lotteries within administrative-territorial units, fee for advertising, fee for using local symbols, fee for trade facilities and/or service facilities, market fee, fee for temporary accommodation, resort fee, fee for providing car transportation services for passengers. There are also plans to regulate the administration of the tax on immovable property paid by legal entities to the local tax collection service of the Balti City Hall; to make other changes to section VI of the Tax Code, ensuring the transfer of the property tax to the local budgets at the legislative level. It is planned that the approval and application of the draft law on the status of Balti municipality would create the necessary conditions for the activity of local public authorities of Balti municipality based on the principle of local autonomy, established and guaranteed by the Law on Local Public Administration, the Constitution of the Republic of Moldova and the European Charter of Local Self-Government. Also the draft law could serve as a model for revision of all the legislation in the field of local public administration, which could be applied in all the territorial-administrative units of Moldova. // 06.07.2022 – InfoMarket
