Taxation power of local governments: Comparison of Turkey and selected countries

The local governments are also involved in the providing of public services together with the central government. Although in the delivery of public services in federal countries local governments are given more weight, same situation is not valid for a unitary country. This situation which is valid in terms of public service delivery, is also true in terms of revenue sharing. In federal-structural countries local governments are more effective on income sources. However, in recent years, new tendency has emerged that local governments within a unitary structure also obtain tax revenues. It can be give authority to local governments about to determine tax rates within certain limits which are ruled and to collect some type of taxes. Hence in the study the revenue sources of local governments in Turkey as a unitary structure are discussed. In this context, municipalities revenue sources were examined rather than special provincial administrations and villages revenue sources. The local governments or rather the municipalities in Turkey encounter inadequate income which has been seen from both statistical data and the survey conducted to municipalities in Aydın Province. It is noteworthy that self-incomes in the income structure remain at very low levels and local authorities have to depend to the central government because of lack of taxation powers. In order to overcome these problems, local government taxation powers have been examined with emphasis on examples of federal and unitary structured countries and alternative tax policies has been revealed for Turkey application.