The thin end of a very nasty wedge

Brussels has announced plans for an EU-wide petrol/carbon tax.  There is now apparently an EU Commissioner for taxation, Mr. Algerdas Semeta (no, I hadn’t heard of him either).  He knows that a similar proposal five years ago was abandoned without serious consideration, but he believes “there is currently the right momentum”.  The scheme of course has the support of Grumpy Rumpy Pumpy.

We should be in no doubt that EU “Own Resources” — in other words, direct EU taxation — is the next big thing in EU integration.  It will be the focus of the Commission for the next five years.

The issue came up on the Today Programme this morning, and Mats Perrson of Open Europe was uncharacteristically vague.  He thought the proceeds of the tax would go to national governments.  My understanding is that they go straight to Brussels.  That is largely the point of it.  And Mats then talked about fairly marginal points, like the need to integrate taxes into local structures, and the differences between types of generating technology in different countries.  All very worthy, but in my view missing the key points.

First, this is the thin end of a very nasty wedge. Brussels wants a common fiscal policy, a debt union, and central common taxation.  It sees the ability to tax and spend as the next natural step in the EU process, and it believes that the Lisbon Treaty opens the door to that policy.  It will start with “green taxes”, which it believes will be easier to sell, but we should be in no doubt at all that the intention is to go on to income taxes, corporate taxes, and so on, until national governments are simply raising local taxes like a District Council.

Secondly, this removes tax-raising powers ever further from democratic accountability. We all know that the European parliament provides only the thinnest illusion of EU democracy, and in any case most MEPs would vote for EU taxes in principle.  Yet as Dan Hannan argued so cogently at the TFA Tea Party fringe event in Brighton last weekend, most of our current economic problems arise because tax raising powers are increasingly removed from the control of the people, and current levels of taxation lack public acceptance or democratic legitimacy.  We are taxed enough already, and we won’t take any more.

To give tax raising powers to the unresponsive, unaccountable, anti-democratic institutions in Brussels would make matters ten times worse.

But look on the bright side.  It would make the argument for Britain to leave the EU absolutely unanswerable.

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