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Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.
The views expressed in these papers are those of the author(s) and do not necessarily reflect those of the OECD or of the governments of its member countries.
Reforming Federal Fiscal Relations in Austria
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- Andrés Fuentes1, Eckhard Wurzel1, Andreas Wörgötter1
- Author Affiliations
- 1: OECD, France
- 23 Jan 2006
- Bibliographic information
This paper reviews the fiscal relations between the three levels of government in Austria and points to the scope for reforming them with a view to improving the efficiency of the public sector. Key areas of public sector activity are subject to complex relations across the three layers of government. Fragmentation of decision-making in some spending programmes, such as hospital care and social assistance benefits, needs to be overcome, concentrating financing and spending responsibilities on one government level. Strengthening co-operation between municipalities as well as amalgamations of small municipalities would allow advantage to be taken of scale economies in the provision of local government services. Stronger tax-raising powers of the municipalities and the states, reform of tax sharing rules and improved budgeting procedures would raise the ability of sub-national governments to match the supply of services to local demand patters and improve accountability to voters. This Working Paper relates to the 2005 OECD Economic Survey of Austria (www.oecd.org/eco/surveys/austria)
- federalism, intergovernmental relations, state and local government finances
- JEL Classification:
- H71: Public Economics / State and Local Government; Intergovernmental Relations / State and Local Taxation, Subsidies, and Revenue
- H72: Public Economics / State and Local Government; Intergovernmental Relations / State and Local Budget and Expenditures
- H77: Public Economics / State and Local Government; Intergovernmental Relations / Intergovernmental Relations; Federalism; Secession