ABSTRACT
The intergovernmental fiscal issue is quite widely discussed and becoming more so, given the very significant worldwide movement toward more decentralized governance. Over the past twenty years, for instance, France has moved from one of the most centralized systems to embrace a process of devolution. The new Italian Constitution of 2001 changed the model of intergovernmental fiscal relations in a variety of aspects too. All administrative tasks have been attributed to municipalities and can be attributed to the upper level of government according to the “principle of subsidiarity.” Asian countries, Korea, Thailand and Indonesia, etc., are not exceptions to these trends. One interesting type of devolution has occurred in EU countries that have responded to desires by different parts of a nation with strong individual identities for regional assemblies that allow a measure of self-determination (OECD 2002b). Examples of this include the introduction of regional assemblies in parts of Spain, for instance in the Basque Country and in Catalonia, the introduction of federalism in Belgium, and the introduction of regional assemblies in the United Kingdom for Scotland and Wales. Similar forces may also have encouraged the evolution of regional assemblies in Italy, and they may lead in time to similar institutions in France for Brittany and Corsica. On the other hand, in some countries, local government has no general power. They may exercise only the powers expressly transferred to them by law. Local finance is mostly deprived as fiscal autonomy is very limited.
