Abstract
Financial responsibility traces the academic and political debate of any decentralising process. This is even more so in the European context, in which taxes – exclusively set and regulated by the subnational legislator – play a marginal role in subnational financing, though in theory they are the most genuine instrument for making SNGs pay for their decisions. Against this framework, this contribution delves into a selection of case studies (i.e., Germany and Spain) testing the principle of financial responsibility from a comparative and legal perspective. The basic assumption is that the way in which the vertical fiscal gap is addressed influences the degree of financial autonomy (and hence responsibility) of subnational entities. As such, the major issue at stake is the revenue structure of the subnational level of government, with regard to the legal tools and procedures devoted to revenue-sharing, as these elements play a key-role in defining the extent to which SNGs are made financially and politically responsible for their financing.