EU: France and Germany plan for EU-wide tax regime

The Telegraph ^ | 1/20/2012 | Bruno Waterfield, Brussels

[bruinbirdman]

While Germany appeared to offer Britain alternative proposals to the controversial Europe-wide levy on financial transactions today, a draft Franco-German paper, seen by The Daily Telegraph, reveals that the financial transaction tax is seen in Berlin and Paris as the first step to giving the EU a new power to "coordinate" taxation.

The text also links existing European Commission proposals on energy taxation and a common method for calculating corporate tax to the push for new EU powers, heralding a major battle over sovereignty this spring.

"European institutions and member states should accelerate the process of tax co-ordination," the Franco-German paper argues. "In particular the negotiation of the European Commission proposals on energy tax directive, common consolidated corporate tax base and common system of financial transaction tax should be accelerated."

The taxation blueprint has reinforced British fears about the direction that the EU is being pushed in by the eurozone crisis and sets the scene for a new confrontation with David Cameron at a European summit in two weeks.

The Prime Minister has vowed to veto the European "Tobin Tax" and his "red line" will be underlined by the Franco-German proposals which highlight the financial levy as the thin end of the wedge on EU taxation powers.

"In order to set the stage for enhanced tax co-ordination, France and Germany express their support for the European Commission's proposal on a common system of financial transaction tax," the paper said.

In order to push EU towards greater tax "harmonisation", Germany and France will, later this month, announce proposals to harmonise their corporate tax rates.

Britain has been hostile to commission plans for an energy tax directive and a "common consolidated corporate tax base" because both are seen as eroding national sovereignty, opening the door to the EU

[the invisib1e hand]

everyone who was predicting the end of the union a month ago had it quite backwards, as I frequently tried to point out.

unions don't end. they get more monolithic.

[RetiredTexasVet]

They couldn’t get the peons to agree to vote themselves out of existence as separate countries, so they are doing the same thing using the back door. Anyone that tries to oppose them (such as the UK) will be isolated and punished economically until they agree. The legal hammer to smash the opposition belongs to the EU. When they joined the EU, it was like walking the plank .... you cannot un-walk it!

[az_gila]

From the article

Eurogas, which represents the European gas industry, is concerned because the commission proposals would set a minimum tax rates for natural gas at “eight and half-fold higher than the current levels”.

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Hey, they are short of money, what's a little 850% tax increase?

[expat2]

Tell that to the USSR

[SunkenCiv]

Thanks bruinbirdman. This proposal is to equalize corporate tax rates, IOW, to prevent artificial incentives for companies to move. This would be of benefit to second (or third) tier EU members, by pushing up tax revenues while maintaining a labor cost advantage.

Of course, that won't last, the next step will be to liquidate other artificial incentives.

'The Consolation of Blogging: The European Union -- a State of hopeful confusion'

[the invisib1e hand]

Tell that to the USSR

They already know that communism is deeper and wider spread now than it ever was.