commission on fiscal imbalance 合集

The overall operating aid of the departments follows

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Unformatted text preview: onal subsidies, most of the aid is now comprehensive, i.e. it is not allocated or conditioned by a specific use. ♦ The financial stakes are high since territorial fragmentation in France and the predominance of a high-yield local tax in respect of businesses is exacerbating disparities in fiscal capacity between local authorities and, consequently, the need for equalization. ♦ Since 1996, aid has been divided between budgeted (rationed) and non-budgeted (non-rationed) aid. The entire array of rationing measures was included in two successive contracts between the State and local authorities, i.e. the Pacte de Stabilité Financière, between 1996 and 1998, and the Contrat de Croissance et de Solidarité, between 1999 and 2001 (cf. infra.). ♦ Transfers from the State to local authorities fall into four categories: operating aid and grants, aid and grants covering amenities, aid covering transfers of jurisdiction, and compensation for tax exemptions and legislative abatements. ♦ Operating aid and grants (126 billion francs in 2000) include: — overall operating aid (DGF) for the communes and groups, comprising “lump sum aid” (70% of the total) that includes basic aid, equalization aid, compensation aid, a supplement in respect of road works, a minimum guarantee, and “special aid” for central cities and tourist communes. The amount is set in relation to the amount that the commune received under the old system (1993) adjusted to the commune’s population evolution since that time. From one year to the next, it incorporates changing prices (roughly half) and half of growth by volume in GDP. The DGF also includes “development aid”, comprising the DGF of groups of communes with own-source taxation (the amount of this DGF is high in order to encourage the creation of intercommunal bodies with own-source taxation); urban solidarity aid (DSU) derived, in particular, from a contribution from the Région Île-de-France. It benefits communes with over 10 000 inhabitants with limited fiscal capacity and is apportioned in light of “costs and resources” (fiscal capacity + social housing + APL + revenue). Urban solidarity aid benefits central boroughs and communes with fewer than 10 000 inhabitants, apportioned according to fiscal capacity and population (in the of central boroughs). — — The regions do not receive any DGF, except the Région Île-de-France until 1995. — The business tax national equalization fund (FNPTP) receives part of the proceeds from the business tax of the communes in which are located big establishments and through contributions from the State and, occasionally, big companies (the post office and France Telecom). — The national equalization fund (FNP), established in 1995, is intended for communes with limited fiscal capacity and a considerable tax effort and is funded by means of the surplus of the FNPTP and State contributions. — ♦ The overall operating aid of the departments follows the same princip...
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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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