Sovereignty in the field of taxation is already limited by European law, EMU-rules, directives, code of conduct and state aid law. Sovereignty in the field of taxation is necessary for countries to implement national financial and social-economic policies. With majority voting bigger countries can impose new and higher taxes, introduce minimum levels and pave the way for tax harmonisation. Especially, for those countries that are relatively small and don’t have a big consumer market, taxation is a tool to improve their relative position. It helps to create an attractive business climate and attract investments. Tax sovereignty is an important part of institutional competition in the EU. This current initiative would mean a further imbalance the position of big and small countries. Especially when the UK has left the EU, the balance of power will shift in favour of the big countries. They will be able to push for tax issues that can really hurt the interests of a minority group of member states. There are at least three important reasons why this proposal is dangerous and must be stopped:Ī qualified majority voting on tax issues will give the power to a few large countries with similar interests and objectives. One might suspect that the EU commission hopes to solve its long time goal – to introduce new taxes funding the commission.
Perhaps disappointed by this setback the EU commission is now trying to change how tax proposals are treated. Recently a proposal to introduce a new tax on digital services (DST) was blocked by several smaller countries like Ireland, Sweden and Denmark. Today every member state has veto rights against tax proposals. This is a bold move from the commission that might totally change the way the EU is working. It is important for friends of liberty and lower taxes to react against this initiative. On January 15, the Commission will present the consultation. This has been done without almost no media coverage. When most of us where occupied preparing to celebrate Christmas, the European Commission launched a web questionnaire on the initiative to move to a qualified majority voting on tax issues. Anders Ydstedt is an advisor at Scantech Strategy Advisors to major Swedish industry and business organizations. This article originally appeared on on January 9, 2019.
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