Decarbonisation and intergovernmental fiscal relations: Policy challenges and reform options

Luiz de Mello and Teresa Ter-Minassian

No 43, OECD Working Papers on Fiscal Federalism from OECD Publishing

Abstract: This paper explores the nexus between decarbonisation and intergovernmental fiscal relations, focusing on related challenges and reform options. It highlights the significant role of subnational governments in tackling climate change. Subnational and national governments share responsibilities in areas such as taxation, spending and regulation pertaining to environmental protection, as well as climate change mitigation and adaptation, which calls for effective intergovernmental co-operation to align policy objectives and implementation strategies. The paper outlines decarbonisation requirements across sectors and discusses subnational government involvement in service delivery, investment, revenue generation and regulatory frameworks. Policy options to strengthen subnational contributions to national decarbonisation goals are presented. While focusing primarily on OECD countries, the paper acknowledges the need for improved information on subnational decarbonisation efforts in both advanced and developing countries.

JEL-codes: H23 H70 Q57 (search for similar items in EconPapers)
Date: 2023-06-06
New Economics Papers: this item is included in nep-ene and nep-env
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Persistent link: https://EconPapers.repec.org/RePEc:oec:ctpaab:43-en

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