commission on fiscal imbalance 合集

2 3 4 239 commission on fiscal imbalance references

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Unformatted text preview: ocal elected representatives, the preservation of the local nature of the business tax, or at least the residual fraction of the bases, is no longer automatically guaranteed since the reform of 1999. A purely defensive strategy would probably be doomed to fail. The local authorities will not be able to regain genuine financial autonomy unless, aside from the freedom to spend and borrow, they are also empowered to freely set the tax rates on the tax bases allocated to them. Such fiscal autonomy demands that the tax bases be modernized. It is hard to imagine in France the definition of the tax base coming under the jurisdiction of an authority other than Parliament. However, once Parliament has clearly defined the bases underpinning the revision, its implementation could, as the Mauroy report suggests, be spread over time and be subject to the approval of the authorities concerned. It would be desirable to maintain a deadline and for the reform to apply simultaneously to a sufficiently large relevant geographic area to avoid any detrimental economic distortion and preserve a minimum of clarity with regard to the taxpayers. The guarantee of the maintenance of the fiscal autonomy of local authorities does not make any less necessary the maintenance of transfers from the State, both for reasons of economic efficiency and because of the absence of congruence between changes in expenditures and tax revenues, by level of local authority. The development of intercommunal groups would considerably reduce the need for financial equalization. If the scenarios elaborated here suggest that there is a possibility of saving the necessary fiscal autonomy of the local authorities while avoiding a conflict with the State on questions of financing, we must, however, emphasize the overall constraints of the undertaking, stemming from our commitments under the Maastricht Treaty. The avoidance of conflict over the debt margin between the State and local authorities is only possible insofar as the “fiscal boundaries” between these authorities and, indeed, social agencies, are modified. The strategic interplay between social agencies, local authorities and the State for access to the two broadly rationed “resources,” i.e. the budget deficit and debt, has only two outcomes (Guengant and Josselin 2001). One outcome, which would be negotiated, would lead to a voluntary division between the players of constraints and frustrations. The other outcome would lead to one player, undoubtedly the State, since it alone is unquestionably responsible for compliance with the budgetary and financial criteria associated with international treaties, imposing on other organizations and public authorities a strict financial and budgetary framework. However, there are no examples in which this strategy of the hierarchical transmission of constraints does not lead either to changes in the internal institutional framework, or to less perennial or visible bailouts that indirectly change the...
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This note was uploaded on 03/06/2013 for the course ECON 220 taught by Professor Paulo during the Spring '13 term at University of Liverpool.

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