commission on fiscal imbalance 合集

Clearly provided that the country and its economy

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Unformatted text preview: ins legislative power. ♦ The tax collection system falls under the jurisdiction of the State and is not linked to each territory, with the result that the autonomous communities are unable to assume joint responsibility for taxation. 223 Commission on Fiscal Imbalance In 2001, the funding model for the autonomous communities is being reviewed. For this reason, it was necessary to develop a new model that offsets the shortcomings of the existing model and is accepted by all political forces in the Spanish State (consensus) in order to ensure that it endures. This model should be based on the principles of economic self-sufficiency, financial autonomy, joint responsibility for taxation and solidarity and draw us closer in its economic concretion to the models for the economic agreement in force in the two autonomous communities, called “Forales,” of the Spanish State (the Basque Country and Navarre), in order to rebalance the existing differential in economic flows between the State and Catalonia (fiscal balance). On October 18, 2000, the Parliament of Catalonia approved a resolution (257/VI) respecting a new system of funding by the Generalitat de Catalogne. In this resolution, the government has been asked to negotiate the establishment of a new funding system that takes into account the criteria mentioned. In this way, under a mandate from Parliament, the Government of Catalonia, headed by Francesc Homs, Advisor for Economic Affairs and Finance, has taken the initiative for and assumed the entire process of negotiating the new model with the central government and the autonomous communities. Mention should be made of the characteristics indicated below. 1. A MODEL BASED ON THE DISTRIBUTION OF REVENUES AND NOT ON THE UPDATING OF EXPENDITURES The revenues of the Generalitat de Catalogne must depend on the taxes paid by the citizens of Catalonia to Catalonia, the essential, underlying principle that inspires and guides the existing agreement model in the Basque Country and Navarre and the most modern models of neighbouring countries. This factor is basic and strategic in the new pact. 2. INCREASE FINANCIAL AUTONOMY THROUGH THE INTRODUCTION OF THE CRITERION OF DIRECT PARTICIPATION IN A TAX BASKET From which the Generalitat will participate in 11 of the 13 taxes paid by Catalans. This factor alters the breakdown of participation in the Generalitat de Catalogne’s revenues: in 1982, only 16% of revenues came directly from taxes paid by Catalans. Now, under the new model adopted, this proportion will reach 86%. The remaining 14% of the Generalitat’s revenues are transfers from the State and provide leeway for future modifications. Clearly, provided that the country and its economy develop in a positive manner, revenues tend to increase proportionally to the higher revenues derived from the taxes that are part of the tax basket mentioned earlier, which means that the Generalitat’s revenues are not tied to expenditures and changes in the latter. In previous review...
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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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