commission on fiscal imbalance 合集

But the amounts of transfer payments to the cantons

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Unformatted text preview: ly entangled. However, the principle of subsidiarity is a strong guideline for the assignment of functions in the fiscal hierarchy, as the example of education expenditures shows. But creeping centralisation intervenes more en more in changing the "choice" role of sub-central jurisdictions in an "agency" role. At the local level, more populous municipalities are in a better position for resisting to this change. The main revenue sources of the public sector are direct taxation on individual income and wealth and on corporate profits and capital, then expenditure taxes and user charges. But the respective proportions of these receipts vary for the three levels of government. Cantons and communes have low dependence on transfer payments. 77 per cent of the Cantons' revenues and 84 per cent of the communes' revenues are own revenues. These figures contrast with a higher degree of centralisation in public expenditures. Fiscal sovereignty belongs to the Confederation and the Cantons. Yet, its exercise is tempered by inter-jurisdictional competition and the mobility of taxable units, and limited by co-ordination and harmonisation practices and law. The communes have no authority over taxation, but have full fiscal flexibility. Budget responsibility is required at the three levels of government. It means that current budgets should be balanced, borrowing can only finance investments and that only limited transfer payments are available. This is a classical approach to public finance. In addition, direct access to many revenue sources is essential. In addition to cantonal disparities in economic potentials, the use of non-benefit taxation by decentralised levels of government, different cantonal ideas on tax equity and a fairly large amount of autonomy to decide and offer public services result in large differences in the fiscal burden of individuals in the Cantons as shown by the indices of cantonal fiscal burdens for various tax revenues. Equalisation schemes intervene in order to compensate partly differences in the revenue-raising capacities of the Cantons. But the amounts of transfer payments to the cantons remain modest owing to the objectives of budget responsibility and financial autonomy of the various jurisdictions. There is no claim to obtain identical economic and fiscal conditions across cantonal and communal jurisdictions. The Swiss experience introduces pragmatism in fiscal federalism. Financial and budgetary autonomy of decentralised governments permits them to engage in specific public policies, alone or in many forms of horizontal and vertical cooperation. Comparison and competition between the individual jurisdictions ensure that only those policies which are in the long term accepted by the population can be carried through. The correct solution is not declared ex ante as binding, but emerges ex post after a selection procedure, which, like a process of trial and error, has compared the various approaches with one another...
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