Proceedings of the International scientific and practical conference ―The Hague Conference on Science and Public Policy‖ (May 8-10, 2026) / Publisher website: www.naukainfo.com. – The Hague, Netherlands, 2026. - 232 p.

46 improving the well-being of citizens, forming the foundations for increasing the level and quality of life in every settlement in the country. The effectiveness of the functioning of the public finance management system has a positive impact on the stability of the country's budgetary, financial and economic policies. It is a factor in achieving significant results and ensuring sustainable dynamics of the country's socio-economic development. Various imbalances caused by endogenous and exogenous factors undermine the stability of the system and inhibit the country's socio-economic development. Effective distribution, management and use of public finances is a tool for sustainable development and the formation of the foundations of economic growth. Public finances are a system of state funds aimed at financing its main functions, a component of the country's financial system, the main central link through which the state influences socio-economic development. Public finances are the main object of financial relations that help the state distribute and redistribute a significant share of GDP. The predominant share of GDP is created at the expense of income (profit), social insurance contributions and other needs, as well as from wages, taxes, fees and payments made by the population. Indirect taxes account for a significant proportion of the GDP structure. The formation of GDP, as the basis of public finances, is carried out through the mechanism of monetary expression of newly created added value, which is manifested in the relevant taxes, fees, other payments. Part of the monetary expression carries the cost of depreciation deductions for fixed assets, etc. The structure of public finances consists of: centralized and decentralized special-purpose funds, finances of municipal and state enterprises, state and local budgets, personal state and property insurance, and state credit. Each part of public finances has its own orbit of functioning, closely interacting with its structural elements. The state, distributing and redistributing GDP, uses finances as the main object of financial relations. The formation and use of public finances is based on a system of relations, the subjects of which are: the state, legal entities, individuals, and the object is GDP.