On November 10 in the framework of the reception dedicated to Self-Governance Day in Armenia was held the presentation of 2019 Annual Report on the Situation of Local Democracy and Decentralization in Armenia prepared by Union of Communities of Armenia (UCA) for the first time.

The report was prepared in collaboration with the Union's experts and contains information on the current situation in the field of local self-government in Armenia. The report also contains suggestions for problem solving and overcoming.

One of the concerns included in the document is that as a result of the territorial reform, the local self-government bodies were given numerous powers, however, the state has not provided adequate financial resources for their implementation.

There are a number of delegated powers for which no funding is provided to the communities, but in fact, they are implemented by the latter.

In the document it is mentioned RA edited law on Local Self-Government, adopted on the 16th of December, 2016, by which an attempt was made to define new opportunities but they do not have the character of real decentralization.

Another concern is that neither taxes prescribed by laws nor other funding sources of the LSG bodies, due to their nature, respond to inflation and other economic factors and have not changed for a long time.

In the report it is stated that the local self-government bodies have about 300 powers, which do not reflect the expectations of community members to get specific public services.

In the report it is stated that the distribution of expenses of Yerevan and the rest of the communities of the RA is not proportional: in Yerevan it is 66,500 AMD for one person, in marzes 27,100 AMD.

There are numerouse suggestions in the report:

• Give the local authorities the power to set land tax and property tax rates within the limits set by law,
• Define a strategy of financial and fiscal decentralization,
• Calculate and analyze the fiscal decentralization index of Armenia,
• Increase the level of dependency of communities on local taxes- the level of fiscal dependency,
• New taxes should be imposed at the local level, in terms of leveling, in line with the principle of income neutrality,
• Increase financial independence of communities, providing new sustainable sources of community budget revenues,
• Increasing the level of fiscal decentralization of communities should be implemented without increasing the overall tax burden etc.