Les déterminants politiques des choix fiscaux locaux. Le cas des départements en France

This article aims at analysing simultaneously three potential determinants of local tax setting by the French departments: the tax rate choices by the neighbouring departments, demographic and economic local features, and some political determinants, especially the degree of political competition in the local assembly. We estimate for the three main direct local taxes a static model of fiscal choices to determine the impact of these determinants on the tax setting. We obtain the following results. First, local political variables and tax mimicking behaviour only influence disparities in business tax rates. Second, departmental executives lower their business tax rate when their margin in seats at the local assembly increases, the reduction being smaller with leftwing local majorities than with rightwing local majorities. This result suggests that elected representatives in French departments adopt a partisan behaviour.