The evolutional aspects of decentralization processes of local finances in Europe, approaches of some foreign and national researchers to the understanding of decentralization as expansion of rights and jurisdictions of local authorities in the field of territorial development have been considered. The essence of «fiscal decentralization» in the context of the forming of budgets of the organs of local self-government by taxes and takings and also their influence on the development of territories and the overcoming of territorial disproportions has been studied. It has been marked that elaborations of V. Outs and hypothesis of American economist Ch. Tibu «feet voting» are important scientific works in sphere of fiscal decentralization. It has been proved that distribution of functions between budgets to a certain extent depends on the political system of the country. 

fiscal decentralization, budgetary federalism