VAT
Income from aviation? EasyTax!
- Posted by Rob (#1) on July 4, 2006 16:49 CEST
The European Union does not have the power to levy taxes, but don't blame that on lack of trying. Here's a new EU proposal on air taxes:
Parliament is discussing the proposals, contained in a report, as Europeans queue up at airports to fly off on holiday.
The report recommends that the airline industry's exemption from paying Value Added Tax (VAT) on fuel should be scrapped, and says an additional fuel tax should be brought in. It would apply around the world.
I'm worried.
Removing existing tax exemptions does not worry me so much. In reality the proverbial exception to the rule means nothing but more rules and more complex rules, in other words bureaucracy. Of course, compared to sales tax, VAT itself is very bureaucratic, but the removal of exemptions would at least make more transparent to deal with VAT.
However.. historically governments have been inept to even make an estimation of the economical costs of their actions. Let alone a worthful comparision of costs to actual benefits (in this case environmental). The EU in particular is not known for transparency nor efficiency, so there would be no way to verify that the extra tax revenue would actually be invested in the environment. It is far more likely extra taxes would primarily assist the continuous relative growth of government budget compared to GDP.
Last but not least: raise your hand if you agree that the European Union should not have the capability, ambition, desire and sheer arrogance to talk about levying taxes that "would apply around the world".
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- Tags: European Union, taxation, sales tax, VAT
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