EU tax harmony: is it likely and what will be the effect

This article on SBPOST.ie has raised the spector of tax harmony in the EU...
[broken link removed]

what are the opinions on:
1. whether this is likely to happen
2. What is the timeframe
3. and what wil be the effects,

It's interesting to noe that the forum for Charlie's hissy fit was the Irish Auctioneers and Valuers Institute

Don't know the answers to # 1 & 2 above but generally I think its a bad idea. When possible why not let the market and local conditions dictate a tax rate? I think an EU wide tax rate is a bit too socialistic - look at other large republics with varying geography and spread of income (the US); each state is able to set its own corporate tax rate. Sure the little state of Delaware has loads of corporations registered to it but on the whole I think businesses in the US aren't hard-up by any means.

When Hell Freezes over is the answer. France would love it, Corporate tax would be raised to 50%. There was a possibility when the EU was just 12 or 15 Western States, but no chance with 25 soon to be 27 states with varying economic states.

Perhaps a common VAT rate may be a runner in the years to come.

Yes, it's more likely that VAT rates will move closer, especially with so much e-commerce putting pressure on this issue.

Also, the standard rates are fairly close already:

Ireland = 21%
France = 20.6%
Germany = 19%
UK = 17.5%

More media coverage of

"Warning on consolidated corporate tax base"


"
He said the Commissioner for Taxation wants to introduce proposals for a common consolidated corporate tax base (CCCTB) by 2008 and Ireland has a 'serious battle' on its hands if it wants to stop this"


http://www.rte.ie/business/2007/0424/EU.html

Protocol said:

Yes, it's more likely that VAT rates will move closer, especially with so much e-commerce putting pressure on this issue.

Also, the standard rates are fairly close already:

Ireland = 21%
France = 20.6%
Germany = 19%
UK = 17.5%

Click to expand...

Agreed - it will be a common VAT and duty rate - Already the mechanisms for this are being put in place with the entire Customs and Excise apparatus throughout the EU going through massive changes and being streamlined - all with the purpose of harmonizing duty rates (which are pretty well done in regard to exEU trade with the exception of alcohol and tobacco) - the framework for extending this to VAT with relative ease will be already in place - I think it will be a federal tax to fund the commission activites - could be a good thing - might get rid of the horsetrading that goes on at the moment over who pays for what and who can hold up the entire programme if they dont get what they want.

As regards Corporate or income tax - they can go whistle for it - Not a runner - Mccreevy is just flying a kite to guage the reaction - the only ones in major favour of this are the French and if Sarko wins - this might change - if Sego wins - well it will still be French left and civil service and their achronistic king Canute like battle against Globalization against the rest of Europe - nah a complete non-runner.