Tokayev orders to prepare package of new practical reforms in tax and budget policies

NUR-SULTAN. July 14 (Interfax) - The new tax and budget policies should maximally decentralize the financial and economic functions of the center, giving them to the regions, Kazakh President Kassym-Jomart Tokayev said, ordering the preparation of a package of relevant practical reforms.

"The issue of fair distribution of revenues between budget levels remains acute. The revenue distribution system is not objective under the conditions of tough fiscal centralization. All regions, except four, have become subsidized and depend on the center. Essentially, they are not motivated to increase tax collection. This leads to a shortage of funds," Tokayev said at a government meeting on Thursday.

Local budgets cover only one-fifth of the needed funding, and the rest can be obtained only by "reaching agreements" with the center, he said.

The implementation of current budgets is often accompanied by red tape and delays, Tokayev said. "As a result, citizens' social expectations are not met. There are facts when construction and assembly work start only three years later. And the current system focuses on timeliness and full use of budget funds. And effectiveness of spending and the quality of the work remain in the background," he said.

"The new tax and budget policy should maximally decentralize the financial and economic functions of the center in favor of the regions," the president said.