Tax Coordination in the European Community
Sijbren Cnossen (editor)
Series on International Taxation, No. 7; Kluwer Law and Taxation
Deventer, New York, NY, USA, 1987, x + 377 pp., $112.50.
This book comes at a time when the issue of tax coordination and harmonization is high on the agenda of European governments who have committed themselves to complete the internal market of the European Community by 1992. It therefore makes interesting reading both for professionals involved in the debate as well as for those affected by European tax harmonization.
The book contains 13 papers presented at a conference on August 24, 1985 in Rotterdam, and covers a great variety of subjects, including tax structure developments, the harmonization of product taxes, taxes on motoring, the coordination of taxes on capital income and corporations, personal income taxes, and the interaction between fiscal and monetary policies. The contributors to this conference volume argue that border controls and customs posts can be abolished by shifting border tax adjustments for the value-added taxes to books of account. Value-added tax rate harmonization is not essential, but approximation of some excise taxes, as in the area of motoring, may be desirable. Moreover, the free movement of capital would be promoted through adoption of a source-based, equal-rate corporation tax applied to a uniformly defined base. In view of the residence principle, however, the harmonization of taxes on labor income is less urgent. Finally, it is argued that efforts toward tax harmonization may be undone if monetary policies are not coordinated. Highly recommended for all those interested in the subject.