Bulletin n. 3/2010
January 2011
CONTENTS
  • Section A) The theory and practise of the federal states and multi-level systems of government
  • Section B) Global governance and international organizations
  • Section C) Regional integration processes
  • Section D) Federalism as a political idea
    • Allersa Maarten A., Ishemoi Lewis
    Fiscal Capacity Equalisation in Tanzania
    in Local Government Studies , Vol. 36, issue 5 ,  2010 ,  697 - 713
    Fiscal equalisation aims at enabling decentralised governments to supply similar services at similar tax rates. In order to equalise fiscal disparities, differences in both fiscal capacities and in fiscal needs have to be measured. This paper focuses on the measurement of fiscal capacity in a developing country. The current intergovernmental transfer system in Tanzania does not take differences in fiscal capacity into account. As a result, local governments in rich areas are able to generate considerably more revenue per capita than those in poor areas. Public services in poor areas are hard to finance. We propose a way of measuring fiscal capacities of local governments in Tanzania using poverty data. We use this measure to derive an equalisation grant that would support local governments that have a low fiscal capacity
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