Details

Technical Note

Fiscal Decentralisation - International Experiences

Tariq Mahmud

INDUSTRY :

AREA : Business Government/International Economy

ORGANIZATION : International

LENGTH : 31

LUMS No : 16-301-2014-2

PUBLICATION YEAR : 2014

KEYWORDS:

Fiscal Decentralisation,Revenue Streams,Tax to GDP Ratio

DESCRIPTION:

The note focuses on fiscal decentralisation as a means of furthering devolved governance with the aim of ensuring delivery of public services in an efficient, effective, transparent and equitable manner. The broad framework underpins the need for administrative and financial powers at the sub-national and local levels of public management and their adequate backup. At the same time, the note looks at some international experiences with particular reference to India, China and Brazil. It also elaborates upon some of the challenges of fiscal decentralisation in Pakistan amid growing expenditure responsibilities at the provincial and the local levels.

LEARNING OBJECTIVES:

The foremost objective is to get familiarised with the concept of fiscal decentralisation and its growing significance, in both the unitary and federal types of governments as a key instrument to promote devolved public management. Fiscal decentralisation implies transfer of revenue resources on a long term sustainable basis in accordance with a laid down procedure from the national to subnational governments and down below to the local level tiers of public management. This may well require sharing of expenditure responsibilities with the lower rungs as well. Devolved governance/management underline transfer of administrative and financial powers and responsibilities from the national to sub-national and local levels. The study aims to provide insight into different country models, their processes and strategies leading to growing revenue streams and expenditure responsibilities. Another key objective is to underscore some grey areas in the context of Pakistan for low tax to GDP ratio and remedial course in this regard for creating more financial space to meet the demands.

SUBJECTS COVERED:

Business Government, International Economy