CONCENTRATION AND DEPENDENCE OF CONSTITUTIONAL TRANSFERS IN THE MUNICIPALITIES OF PARA

This study addresses the intergovernmental financial resources transfers and is guided by the following research problem: are the resource transfers between federated entities meeting their goal of equalizing regional disparities? This research aimed to investigate the inequality of distribuition of the constitutional financial resources to municipalities in Para state, Brazil. The research is based on the theory of public finances, notably on the theory of tax revenue sharing between federated entities. The hypothesis stablished assumes that there is concentration of the constitutional financial transfers in the municipalities of Para, specifically the Municipal Participation Fund (FPM) and the distribution of the the Tax on the Circulation of Goods and Services (ICMS).To test this hypothesis, the Theil's T index and the Gini coefficient were used for the municipalities of Para between 2010 and 2016. The results showed that there is a concentration of resources in a restricted group of municipalities for the resources of ICMS, on the other hand, there is greater dispersion in FPM distribution. This occurs because the ICMS has great weight on municipalities with higher fiscal added value, while the FPM criteria are favorable to better distribute resources. However, there is still a strong dependence on municipalities to the distribution of these resources, which requires a more efficient management of municipal governments to make better use of available resources.