Lessons from Spain, Germany and Canada
Studies in Fiscal Federalism and State–local Finance series
Edited by Núria Bosch and José M. Durán
Chapter 4: Tax Assignment and Regional Co-responsibility in Spain
Juan A. Gimeno Ullastres 1 1.1 INTRODUCTION – PRESENT SITUATION Co-responsibility, Suﬃciency and Solidarity The most prominent characteristic of the evolution of the Spanish system of autonomic ﬁnancing is the speed with which the process of ﬁscal federalization has occurred. At the end of the 1970s, an extremely centralized structure was inherited in which the central administration managed 85 per cent of public expenditure, while the remaining 15 per cent was in the hands of the local administrations (town halls and county councils or mixed bodies). The 1978 Constitution sets up what is known as the autonomic state, in which the Autonomous Communities (ACs) are intermediate administration entities for regions or nationalities. In subsequent years, it was viewed as desirable to aim for an assignment among the three cited levels of government (i.e., central, autonomous and local) of 50, 25 and 25 percent, respectively. In only a quarter of a century the assignment percentages have become 50, 35 and 15 per cent, which are 30, 50 and 20 per cent if we exclude social security. The headline numbers serve to underline that there has been a very rapid transfer of competences from the state to the Autonomous Communities, whereas the relative weight of the local administrations has scarcely changed. Although we will center on autonomic ﬁnancing, we deliberately include in the whole analysis constant references to the local administrations. This is because any ideal solution needs to take into consideration all the actors simultaneously. Ultimately, the taxpayer is always the...
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