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Fiscal Consolidation: Part 6. What Are the Best Policy Instruments for Fiscal Consolidation?

  • Robert P. Hagemann
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    OECD countries face daunting fiscal challenges following the substantial surge in debt-GDP ratios during the past four years, from already high levels in many cases. Fiscal consolidation is now the order of the day, and it takes on greater urgency against the backdrop of imminent budgetary pressures from population ageing. While strong growth would help, the bulk of consolidation will require specific structural reforms to spending and revenue programmes to stabilise and then reduce debt-GDP ratios. On the spending side, many reform options offer budgetary savings through improved efficiency, without loss of desired outcomes or adverse equity impacts. Areas examined in this paper include health care, education, infrastructure, general public services, and transfer programmes. On the revenue side, countries’ tax systems are perforated by tax expenditures that cause inefficiencies, reduce revenue, and undermine fairness. Reducing the scope and scale of tax expenditures remains one of the most promising means of boosting revenues while improving economic performance. Shifting taxation toward less inefficient tax bases also holds much promise, including raising the importance of both property taxation and environmental levies. Even without quantifying all possible measures, the cumulative cuts in spending and increases in taxation could yield 6% of GDP on average across countries in consolidation, with somewhat more on the spending side. Consolidation budgétaire : Partie 6. Quels sont les meilleurs instruments de la consolidation budgétaire ? Les pays de l’OCDE sont confrontés à de considérables difficultés budgétaires par suite du brusque gonflement, depuis des niveaux dans bien des cas déjà élevés, de la dette publique par rapport au PIB ces quatre dernières années. L’assainissement budgétaire est désormais la priorité du moment et devient de plus en plus pressant du fait de l’imminence des tensions budgétaires dues au vieillissement de la population. Si une croissance vigoureuse constituerait une aide incontestable, on ne pourra faire l’économie, pour assainir les finances publiques, de réformes structurelles spécifiques des programmes de dépenses et de recettes afin de stabiliser, puis de faire baisser les ratios dette/PIB. Du côté des dépenses, de nombreuses voies de réforme permettent de réaliser des économies budgétaires en améliorant l’efficience, sans annihiler les résultats attendus ou avoir d’impacts défavorables du point de vue de l’équité. Au nombre des domaines étudiés dans ce document figurent la santé, l’éducation, les infrastructures, les services publics généraux et les programmes de transfert. Du côté des recettes, les régimes fiscaux des différents pays sont grevés par les dépenses fiscales qui sont sources d’inefficiences, amputent les recettes et sapent l’équité. Réduire la portée et l’ampleur des dépenses fiscales reste l’un des moyens les plus prometteurs de gonfler les recettes tout en améliorant la performance économique. La réorientation de l’imposition vers des assiettes fiscales moins inefficientes, notamment en donnant plus d’importance à l’imposition foncière et aux prélèvements environnementaux, est également très prometteuse. Même sans quantifier toutes les mesures possibles, les réductions de dépenses cumulées et le relèvement de l’imposition pourraient rapporter 6 % du PIB en moyenne dans les pays procédant à un assainissement de leurs finances publiques, la part de ce pourcentage attribuable aux réductions de dépenses étant un peu plus importante.

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    Paper provided by OECD Publishing in its series OECD Economics Department Working Papers with number 937.

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    Date of creation: 10 Jan 2012
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    Handle: RePEc:oec:ecoaaa:937-en
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