Local government finance
Resourcing local government remains a central challenge to effective decentralisation. This section has content relating to different models of fiscal decentralisation, options for identifying new sources of local revenue, such as local property tax; and strategies for improving collection and deployment of own-source revenue. It also offers information about improving the borrowing potential of local government, innovative financing models such as municipal bonds, shared services, and public private partnerships.
- Fiscal decentralisation
- Financial management
- Innovative financing models
- Local/own-source revenue generation
- Financing infrastructure
- Public private partnership
- Green finance
- Property tax
Canadian cities have long called for access to more tax revenues. This paper argues that additional taxes are appropriate for major cities, describes the advantages and disadvantages of potential new taxes, and estimates the revenue from a city income tax, a city sales tax, and a city fuel tax for eight Canadian cities – Vancouver, Calgary, Edmonton, Winnipeg, Toronto, Ottawa, Montréal, and Halifax. The authors find that the property tax is a good tax, but cities would benefit from a mix of taxes. In particular, user fees are an important source of revenue and can alter economic behaviour. Taxes on income, sales, vehicle registration, fuel, and hotel stays are also an effective way to diversify local taxes. Of the available options, a personal income tax and a municipal sales tax are likely to generate the largest revenues. Although setting up their own tax systems would grant cities the greatest fiscal autonomy, doing so would be costly. It would be more cost-effective for cities to piggyback new taxes onto provincial taxes, with the province collecting the revenue and remitting it to cities. To promote local accountability, however, it is essential that local governments set their own tax rates. In this way, taxes levied would be linked to services consumed.
Author: Harry Kitchen and Enid Slack Publisher: University of Toronto Publication year: 2016
This profile of the local government system in Australia is structured to enable easy comparison across the countries of the Commonwealth. The profile includes an overview of the government system, the legal basis for and structure of local government, elections and women’s representation, intergovernmental relations, systems for community involvement, organised local government, intergovernmental relations, monitoring systems, finance, staffing and resources, and distribution of service delivery responsibility.
Author: CLGF Publisher: CLGF Publication year: 2015
Author: Edited by Graham Sansom, Peter McKinlay Publisher: Commonwealth Secretariat Publication year: 2013
Municipal Infrastructure Financing provides an overview of the municipal finances and the extent of private sector involvement in the delivery of municipal services in selected Commonwealth developing countries. Four cities are examined in detail: Dar es Salaam in Tanzania, Kampala in Uganda, Dhaka in Bangladesh, and Karachi in Pakistan. The book presents some innovative options for alternative sources of municipal infrastructure financing, including attracting private sector participation, based on the successful experience of other developing countries. It also identifies the key challenges in municipal financing, and any broad institutional and financial strengthening measures that are required to tap alternative sources of financing for growth-oriented municipal investments.
Author: Munawwar Alam Publisher: Commonwealth Secretariat Publication year: 2010
Decentralisation is now taking place in the public administrations of most countries of the world. A critical determinant of the effective performance of local governments is finance – their ability to both mobilise financial resources and to use those resources effectively and efficiently.
This book explores the variety of methods used to ensure that fiscal decentralisation takes place alongside administrative decentralisation. It considers the range of revenue sources available, the design systems of intergovernmental transfers between central and local government, and the kinds of rules and procedures necessary to ensure that local governments use their financial resources appropriately.
The experiences described in this book will help local government managers, and national policymakers charged with local government finance issues, to ensure that they follow good practice in their own programmes of local government reform.
Author: Nick Devas with Munawwar Alam, Simon Delay, Pritha Venkatachalam and Roger Oppong Koranteng Publisher: Commonwealth Secretariat Publication year: 2008