EU Crackdown on Tax-Avoidance Spells Trouble for Britain

Something went by unnoticed in the press – an EU crackdown on sweetheart tax deals was announced in a decision by the EU’s Council of Ministers. While there is certainly a public interest to see multinationals pay their fair share, the fact remains that every solution from the EU that calls for a slow convergence of our so called ‘free trade area’ makes it look like the customs union the public never voted for.

It would involve all Europe’s Member States disclosing the tax deals made with corporations by their tax authorities. Aside from incremental moves towards further European integration, it speaks of incredible hypocrisy in light of the ‘Luxleaks’ revelation. This is why sovereign governments across Europe must remain ever vigilant of the EU’s backward reforms.

This common rate of corporate tax would not only damage Britain but all of Europe’s ability to compete abroad. Overriding a country’s ability to independently raise a tax base does not only erode our autonomy, but assumes that coercion is better than competition and transparency. A uniform rate across the continent simply puts us at a disadvantage.

Taxation powers should always remain in the hands of a democratically elected government – which the EU is not. Taxation without representation was the rallying cry of American Revolution. The British colonies in America revolted for far less than what the EU is planning. Being robbed of our ability to set our own rate of corporation tax is a disturbing assault on Britain’s sovereignty.

Chillingly, the press release announcing the new rules on tax mentioned at the very bottom: “The next milestone will be an Action Plan on Corporate Taxation. This second Action Plan will focus on measures to make corporate taxation fairer and more efficient within the Single Market, including a re-launch of the Common Consolidated Corporate Tax Base”.

A noble goal perhaps, until one acknowledges it comes as a result of Luxleaks documents, which exposed Luxembourg’s appalling record of ‘facilitating tax evasion on an industrial scale’, as the Guardian puts it. This naturally brought embarrassment to Jean-Claude Juncker, who was Prime Minister of Luxembourg for 18 years, and the deals with multinational corporations, happened under his tenure. This means the EU is now acting to cover up its own hypocrisy.

Now, cracking down on tax-evasion might seem like a good idea, even George Osborne recently announced plans for a “Google” tax to crack down on tax-evading internet giants. After all, shouldn’t foreign companies contribute to the Treasury? However, it is a result of EU law in the first place these companies are avoiding tax.

There is doubt about it: this crackdown is a prelude to a larger power-grab by the EU. Once a common rate of corporation tax is imposed on us, there can be no pretence of Britain being an independent, democratic state. The answer is not reform from within, we must Get Britain Out of the EU


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