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Reforming Fiscal Federalism and Local Government

Beyond the Zero-Sum Game

image of Reforming Fiscal Federalism and Local Government

This book describes and examines reforms of fiscal federalism and local government in 10 OECD countries implemented over the past decade. The country chapters identify common patterns and factors that are conducive to reforms of the intergovernmental fiscal framework, using a common methodological approach. The summary chapter highlights the cross-cutting issues emerging from the country chapters and shows the key factors in the institutional, political, economic and fiscal areas that are supporting reform success. The report’s approach results in valuable insights for policy makers designing, adopting and implementing fiscal federalism and local government reforms.

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Belgium: The Lambermont Agreement

In 2001 both Chambers of the Belgian parliament endorsed a special law that substantially changed the revenue structure of Belgium’s regional entities and the financial balance between the federal and the regional level. The Lambermont Agreement, as it was called, consisted of two distinct elements: i) the re-assignment of several taxes to the regions and further tax autonomy for them; and ii) a considerable increase of federal transfers to the communities. The Lambermont Agreement was the latest in a succession of fiscal decentralisation reforms and the widest-reaching tax assignment reform since Belgium had started to decentralise in the 1970s ().

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