Skopje, 18 May 2023 (MIA) - The United States Agency for International Development (USAID) announced Thursday the third group of new partner-municipalities within the Strengthening Resource Mobilization Activity project. Mayors of twenty-four municipalities signed a Memorandum of Cooperation and committed to improving own-source revenue capacities, improving quality of local tax systems, strengthening operational capacity of local tax administration and improving the capability of local authorities for planning, management, and implementation of public funds.

Minister of Local Self-Government Risto Penov emphasized that all municipalities included in the first phase of the project have increased the collection of property tax rate on average by 34.5 percent, which contributes to an increase in the collection rate of own revenues by 25 percent.

"After alerting some municipalities and the city of Skopje that they have an incomplete database of property taxpayers, the Ministry of Local Self-Government in cooperation with the USAID project initiated specific activities for full support of municipalities in improving their capacities for collection of property tax. It is high time to overcome childhood diseases. Property tax, collection and use of the funds is entirely a local responsibility and competence. That money is from citizens and for citizens. I am not absolving the central government, but responsibilities cannot be taken or not according to one's own wishes and assessments," said Minister Penov.

For that purpose, he added, a special working group was formed with representatives from the Ministries of Finance, Local-Self Government, Transport and Communications, Real Estate cadaste Agency, the State Audit Office, the Parliament's Commission for Local Self-Government, Association of the Units of Local Self-Government (ZELS), the City of Skopje and Ilinden and Tetovo municipalities, which in the coming period will propose specific legislative solutions and ways to exchange data among competent institutions and municipalities.

He pointed out that the Government's specific measures have resulted in the improvement of the system financing the local self-government, revenues from the value added tax and from the personal tax have increased, and with the new way of distributing funds through performance and equalization instruments, a fairer distribution of funds has been enabled. Effects of these measures are expected to be seen by the end of 2023.

Jeri Dible, USAID Country Representative for the Republic of North Macedonia, noted that local leaders and the central government have a key role in the decentralization process and have to work together to solve the most important questions that prevent local development and quality municipal services, and hinder fiscal independence.

"Even though we are your partner and ally, it is your responsibility to deal with these challenges. We are also aware that a single most efficient solution doesn't always exist for complex development challenges you face. That is why our program gives priority to your leadership and knowledge to identify your unique challenges and implementing solutions that fit," said Dible.

Finance Minister Fatmir Besimi also spoke at the event, and gave recognition to the 15 partner municipalities from the first group, who in the past 18 months have managed to improve their administrative capacities for managing municipal public finances, budget planning, and execution, fiscal transparency and accountability, planning and collection of own-source revenue funds, access to external financing, and better cooperation with the private sector.

USAID's project for Strengthening Resource Mobilization Activity is a five-year project (2021-2026) that helps government institutions in North Macedonia to secure and independently manage resources needed for financing the services required by its citizens. To reach this goal, the project provides technical support tailored to the needs of each partner municipality, and also works closely with the Ministry of Finance and Ministry of local Self-Government. ssh/ik/