An alternative VAT
Today the European Commission announced it is considering alternatives to the current VAT system in order to safeguard the EU budget in the future. Here is a copy of the announcement. The full text you can find here.
Very interesting are the alternatives the Commission is thinking about. New levies on financial transactions, green house emissions, air traffic, an EU Corporate income tax and a special VAT rate for these transactions. At the same time the contributions of the Member States would be lowered.
......Finding the right mix of resources
In 1988, Member States’ contributions, based on their GNI, represented 10% of the EU budget, these days they amount to about 70%. Not only does this go against the spirit of the Rome and Lisbon Treaties but this gave birth to the bitter debates about “net contributors” and the complex concepts of rebates with the consequences of favouring instruments with geographically pre-allocated financial envelopes rather than those with the greatest EU added value. The Commission therefore puts forward the option of reducing Member States’ contributions by abolishing the VAT-based own resource and progressively introducing one or several new own resources as a replacement. Possible candidates for new own resources could be a share of a financial transaction or financial activities tax, auctioning of green house gas emission allowances, an EU charge related to air transport, a separate EU VAT rate, a share of an EU energy tax or of an EU corporate income tax.
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