Just a naughty little though, but if there's to be fiscal union for the Eurozone then Austria and Luxembourg could no longer object to the new European Union Savings Tax Directive.
Every cloud has to have a silver lining.
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Luxembourg and Austria do not object to the ESTD amendments (see Frieden’s remarks reported here http://bit.ly/JEbTF1). They refuse to move to automatic exchange of tax information. These are two very different things.
Mark Morris, the guru of all things related to the ESTD amendments, explain very clearly on his site that the two matters should be treated separately. Only the Commission, under Semeta’s tragic leadership, seems unable to understand this.
And as I’ve said already – if we get the answer in two steps, hey ho, that’s the game we’ll play
LU and AT’s objections have nothing to do with the technical amendments to the Savings Tax Directive, which both of them support without reservation. They refuse categorically however to abandon the withholding regime and switch to automatic exchange. The Commission’s refusal to recognise these “red lines” is what is now blocking progress.
The current direction of travel is that the Commission will have to drop the demands dor automatic exchange so that the technical amendments can be approved. This is likely to happen at some point later this year.
So we will have a new Savings Tax Directive, but no automatic exchange.
I doubt that this will make you and your small band of fellow self-proclaimed tax justicialists happy, though!
Don’t doubt, we’ll get AIE – the EU can’t afford to not have it
We may get the technical amendments first
But that’s just procedure
Then we’ll get AIE
Your point Richard was that there could be no fiscal union without a new ESTD. That may or may not be true.
But it is very concievable that there could be fiscal union and the continuation of the withholding regime. One does not exclude the other, at all. In fact, it is by far the most likely outcome.
And in that case tax evasion will continue
And that is very, very unlikely to be acceptable in the current EU climate
What some (but interestingly not all) member states desperately needs are revenues. There is no evidence whatsoever that automatic exchange is superior at delivering additional revenues than withholding on a cost-efficient basis. In fact, the last thing that most member states need is tons of additional data requiring an army of tax inspectors to process.
Nonsense
Revenue arrives when people know they may be found out
AIE delivers that knowledge
Enforcement need only be light touch
The data alone delivers the goods
But then – you’ll always argue for crime, won’t you?
Richard – you are the one talking complete nonsense. The surest way to raise revenues is to withhold the tax due on any income at its source.
According to your logic, we could simply do away with the PAYE system and expects all wage earners to simply file a return and then pay their taxes. There is reason we don’t do it this way; it would NOT WORK.
I am not arguing for crime, but only for common sense. Something you seem to lack.
Sorry – that’s crass
That only works if we have a flat tax with no allowances
By all means withold as a source tax – I have no problem with that – but data has to be provided too or higher rate taxes are evaded – as is tax on capital – and ou well know these are the issues
Which is why your arguments are explicitly designed to support crime and have no other intent that I can see
More nonsense.
If your concern is really about progressive taxation, just set the withholding rate at the highest applicable marginal rate. If the taxpayers feel that they have overpaid, let them claim a refund. It is so easy, one wonders why you did not think of it.
The truth is that you are not at all interested in either raising revenues or applying progressive taxation. Your single obsession is to invade the privacy of citizens you feel are better off than you. It is weird and slightly creepy.
Without AIE you cannot capture data on balances
In that case crime thrives
And that’s what you wish for
I repeat: those arguing against AIE can only have that aim
And as for invading privacy – disclosing your income to a tax authority is the price you pay for living in a democracy
So I’ll add your anti-democratic stance to the charge sheet
What makes you think there will be fiscal union for the Eurozone?
There may not be
But there is talk of it