Assessment of the impact of the land cover structure on tax revenues of local budgets of territorial communities based on GIS technologies

Purpose. The purpose of this study is to identify the influence of land cover structure on tax revenues of local budgets of territorial communities based on GIS technologies. To achieve the goal, the following tasks must be solved: 1) conduct an analysis of the land cover of the Zhytomyr oblast based on GIS technologies; 2) conduct an analysis of tax revenues when forming the budgets of territorial communities of Zhytomyr oblast; 3) conduct modeling as a method of finding connections between the area, structure and change of land cover of three types of territorial communities of Zhytomyr oblast and their revenues from local taxes and fees. Methodology / approach. To achieve the research purpose, two databases were generated and subsequently merged: the first database characterizes the land cover of each of the 66 territorial communities in the Zhytomyr oblast, formed based on GIS technologies, while the second database characterizes the tax revenues of these same territorial communities. Considering the specific nature of the merged database, the panel analysis method was used to construct statistical models. Results. An analysis of the land cover of the Zhytomyr oblast was conducted. The formation of budgets at the level of territorial communities was analyzed. The obtained results of the construction of econometric models and their authors’ justification, considering the opinions of experts, proved that the change in the structure of the land cover can affect the amount of tax revenues to the local budgets of territorial communities. For example, if the share of more productive land cover (forested areas, cultivated lands, land under buildings, etc.), which are objects of taxation, increases in the structure of land cover of rural and urban communities, then in this case, tax revenues will increase both in absolute and relative terms. In urban communities, an increase in the share of built-up land (residential and commercial real estate) in the structure of land cover will contribute to tax revenues from entrepreneurial activities, property tax, and environmental tax. Originality / scientific novelty. In the article, the authors provide empirical evidence of the influence of the area, structure, and changes in land cover on tax revenues for local budgets of territorial communities. For the first time, the authors used a combination of geospatial and econometric methods to analyze land cover and its impact on tax revenues for local budgets of territorial communities. Practical value / implications. The conclusions presented by the authors in this article are of practical value because they testify to the importance of the structure of the land cover in the formation of the financial potential of local self-government. The results suggest that local governments can increase tax revenues by managing land use, especially with respect to productive land cover. The findings also indicate that local governments can implement GIS technology in monitoring land cover changes and identifying areas with high tax revenue potential.