How much does the government cost? Why exactly am I paying taxes?

The term “inter-budgetary relations” exists as a sort of “technical” term in the field of economic policymaking; hence, the general populace virtually never pays attention to such processes. In reality, however, a substantial number of issues that directly affect the quality of life of the average Ukrainian wholly depend on the smooth operation of this obscure mechanism.

Public opinion more often than not regards the perpetual lack of funds in the country as the fundamental cause of remarkably poor implementation of public services. However, such a conviction fails to adequately identify the roots of the problem. After all, even in the wealthiest industrialized democracies, governments often experience a shortage of funds. This is because the dynamics that truly determine the quality of life of the general populace, even in instances of severely limited financial resources, are certain factors such as proper incentives in the market and correct oversight over the use of funds in order to ensure responsible budgetary practices.

Therefore, in this context, we can conclude that proper use of the mechanism of inter-budgetary relations plays a categorically indispensable role in the general well-being of the Ukrainian state.

Read about inter-budgetary relations in detail in CASE Ukraine’s “Inter-budget relations: looking for golden mean” (in Ukrainian).