Common Markets, Common Tax Problems

Abstract

It began with George Washington himself, when he wrote to Lafayette:
I am a citizen of the greatest Republic of Mankind. I see the human race united like a huge family by brotherly ties. We have made a sowing of liberty which will, little by little, spring up across the whole world. One day, on the model of the United States of America, a United States of Europe will come into being. The United States will legislate for all its nationalities.

The United States and the European Union are different in more ways than it is possible to briefly enumerate, but their foundations had a striking similarity of purpose: to increase citizens' welfare by uniting a collection of independent states, each with its own politics, culture, and economy. Of course, the unification of the U.S. states - never as divided politically, culturally, or economically as the countries of Europe- is an achievement largely in the past. In contrast, significant integration in Europe has taken place in our own time. Although the United States and the European Union have similar goals, the political structure and degree of unification differ substantially in each region. The United States is a single country, with a unified polity and a powerful central government, whereas the European Union is a collection of 27 independent countries and peoples with a weak central government. The purpose of this Essay is to explore the common tax problems confronting the U.S. and European Union (EU) common markets.