commission on fiscal imbalance 合集

The opinion of the court of auditors is submitted

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Unformatted text preview: delocalization between the regions. The framers’ desire is clearly understood although it does not define the notion of “unfair tax competition.” In its provisional advice,39 the council of state notes that the precise scope of this notion is unclear and that it is impossible to ascertain whether this notion must be perceived as an applicable jurisdictional control criterion, in this instance, by the court of arbitration. The sentence was nonetheless maintained in order to provide a basis for eventual recourse launched by a region that feels cheated by a tax measure introduced by another region that nonetheless meets the conditions stipulated by the legislation. The council of state recommends that the vague notion of “unfair tax competition” be replaced by the notion of an economic and monetary union, more broadly centred on law, which would provide a more relevant control criterion. We object to this recommendation. Detrimental tax competition engenders a tax rate war in order to attract the tax base. Rates in the different regions may be identical to each other but below the current level. In this case, tax revenues decrease markedly but, given the uniformity of rates, the economic and monetary union is not threatened. The latter notion is thus not sufficient, in our view, to protect the Federal State from the detrimental effects of unfair tax competition. b) Margins control and technical feasibility A region that intends to introduce a tax reform with respect to additional personal income taxes or refunds must follow two procedures. First, it must inform accordingly the federal government and the governments of the other two regions. In conjunction with this exchange of information, a collaboration procedure is necessary to ensure the technical applicability of the reform. Such a procedure has yet to be defined in a cooperation agreement between the regions and the federal 40 government. Second, it must request the opinion of the general assembly of the court of auditors. The opinion deals with compliance with the margins and with the non-reduction of the progressivity of personal income tax. In order for the court of auditors to have the means to issue an opinion, the reform projects and proposals must be accompanied by “sufficient statistical data.”41 In the case of a draft decree, the opinion is requested prior to the submission to the council of the proposal; in the case of a proposed decree, the opinion is requested after its approval by a commission but prior to its examination 42 during a plenary session. The opinion of the court of auditors is submitted within one month. If the deadline is exceeded, the regions are not bound to take account of the opinion. Furthermore, the opinion is not binding. It was initially proposed that the regions that disregard the opinion of the court of auditors be subject to a fine. During the negotiations, this penalty was abandoned in favour of another option, i.e. that no region could implement a tax reduction or in...
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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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