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Is the Compensation Fund an Appropriate Tool for Financing Universal Postal Service Obligations?

In: New Business and Regulatory Strategies in the Postal Sector

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  • Vincenzo Visco-Comandini

    (University of Rome Tor Vergata)

Abstract

This chapter discusses pros and cons of the compensation fund in the postal industry, envisaged in the European directive as an alternative measure to a state subsidy for financing universal service obligations. The fund is a tax charged only to competitors for sharing these costs. Its application conflicts with general normative principles required for making a tax socially efficient, as the benefit principle, the competitive neutrality and the solidarity principle. Their respect makes its tax base and rates definition very problematic, especially with regard to multisided e-commerce parcel markets. The chapter provides a positive explanation for why governments, regulators and national providers may be interested in enacting the fund.

Suggested Citation

  • Vincenzo Visco-Comandini, 2018. "Is the Compensation Fund an Appropriate Tool for Financing Universal Postal Service Obligations?," Topics in Regulatory Economics and Policy, in: Pier Luigi Parcu & Timothy J. Brennan & Victor Glass (ed.), New Business and Regulatory Strategies in the Postal Sector, pages 105-118, Springer.
    • Handle: RePEc:spr:topchp:978-3-030-02937-1_9
    DOI: 10.1007/978-3-030-02937-1_9
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