Fiscal federalism in Switzerland : relevant issues for transition economies in Central and Eastern Europe

Its highly fragmented structure of local governments and serious horizontal fiscal imbalances make Switzerland a surprisingly powerful model for Eastern European countries that are currently facing the challenge of fiscal decentralization. In spite of the substantial differences in the tradition and current practice of intergovernmental fiscal relations, transition economies may learn valuable lessons from the Swiss case in the fields of direct democracy, horizontal cooperation, expenditure and revenue assignment, and fiscal discipline. Among other conclusions, the authors suggest that subnational authorities can effectively fend off recentralization attempts of the central government if they engage in spontaneous cooperation to enhance the efficiency of public service provision. Together with an adequate fiscal equalization scheme, interjurisdictional cooperation also permits the reconciliation of the objective of an increasing devolution of powers with the existing regional disparities. The authors also show that the principle of subsidiarity can best be safeguarded by anchoring the expenditure and revenue powers of subnational governments in the constitution or in a similarly strong law. With regard to fiscal discipline, the combination of a"golden rule"with direct democratic instruments of budget control is proven to be successful in enhancing the accountability of local politicians toward their constituencies.

Voluntary amalgamation of local governments: the Swiss debate in the European context

The debate about the amalgamation of local government units (thereafter LGUs for simplicity – in Switzerland: “communes” or “Gemeinden”) usually stems from the fact that LGUs’ political borders (the institutional territory) do no longer coincide with the economic boundaries required for an efficient provision of most local public services (the functional territory). And both do not correspond with the relational territory which arises out of the private and professional activities of LGUs’ residents as they commute daily or periodically for work, shopping and leisure (Dafflon and Ruegg, 2003: 890). Additional problems are the openness of economic activities and the emergence of industrial clusters which largely overlap local boundaries. Finally, urban areas and agglomerations usually regroup several neighbouring LGUs whereas the needs for specific public services are identical in each of them and require horizontal cooperation. The core question of this paper is how to reform the institutional and functional territories in such a way that public services are delivered efficiently, according to local preferences and in a way that responds to the needs expressed in the larger relational territory. For the local public sector, the main concern is the reorganisation in a new, coherent public institution of the three circles of deciders, beneficiaries and payers, that is: -the residents in the commune that vote the provision of a public service (admittedly, corporate business and business units have no vote), -the users whose residence or domiciliation can be in but also outside the territory of the LGU which provides the service and -the taxpayers when according to the principle of origin, taxation is attributed to the commune of residence of individuals or legal domiciliation of business companie

Fédéralisme, coordination et harmonisation fiscales Etude du cas suisse

1. CHAPITRE PRELIMINAIRE 1.1 Introduction Cette étude a pour objet les problèmes de coordination et d'harmonisation fiscales dans un système fédéral. Pris au sens général, la coordination et l'harmonisation fiscales se réfèrent à l'ensemble des mesures permettant de passer d'un système fiscal épars à un système uniforme, puis unifié. Par système fiscal épars, on entend un système dans lequel la souveraineté fiscale, respectivement les compétences de définir et de prélever des impôts, sont éparpillées entre les niveaux de gouvernement et, à chaque niveau, entre les gouvernements, d'où une situation de conflits. Par système fiscal uniforme, on entend un système fiscal dans lequel les gouvernements appliquent des règles semblables; si ces dernières sont identiques, alors le système fiscal est réputé

Die Dezentralisierung der Sozialpolitik: eine unmögliche Mission? Der Fall der Krankenversicherung in der Schweiz

Als einziges Land in Europa betreibt die Schweiz seit 1996 eine Krankenversicherungspolitik, die mehrheitlich aus lohnunabhängigen Kopfpauschalen finanziert wird und den sozialen Ausgleich durch das staatliche Steuer-Transfer-System realisiert. Die gegenwärtige Debatte in Deutschland über die Reform der Gesetzlichen Krankenversicherung lässt sich teilweise durch das schweizerische Modell inspirieren. Das Beispiel der Schweiz zeigt allerdings auch, dass die dezentralisierte Finanzierung staatlicher Prämienzuschüsse den daran mitwirkenden Autoritäten einen verstärkten Anreiz zu strategischem Verhalten bietet. Die weitgehende Autonomie der mittleren Regierungsebene bei der Bestimmung des Subventionsbeitrags kann die vom Bund anvisierten Umverteilungs- und Ausgleichsziele stark verzerren. Die Vergleichbarkeit zwischen Deutschland und der Schweiz bezüglich des föderativen Staatsaufbaus lässt den Schluss zu, dass bei der gegenwärtigen deutschen Finanzierungsreform besondere Vorsicht geboten ist.As the only European country, Switzerland has had a policy of health insurance since 1996 the majority of which is financed by capitation fees which are independent of wages and which realises the social equalization through the governmental tax-transfer-system. The current debate in Germany on the reform of the Statutory Health Insurance is partly inspired by the Swiss model. The example of Switzerland however also shows that decentralised financing of governmental premium subsidies offers the cooperating authorities an intensified incentive to strategic behaviour. The large degree of autonomy of the middle-grade governmental level concerning the determination of the subsidy contribution can strongly distort the redistribution and compensation objectives of the Federal Government. The comparability of Germany and Switzerland concerning the federal governmental structures allows the conclusion that special care must be invested in the current German financing reform