Tuesday, February 15, 2005

European Union officials and Taxation

This was the title of a lecture which I was encouraged to turn up to today in the European Parliament. The lecture was given by one Maitre Jacques Buekenhoudt who by looking at his c.v. I guess is the superior expert in the field. He came across as a decent fellow too.

Contrary to popular belief officials who work for the European Institutions do pay tax. Indeed the do, but of course they pay their tax into the central EU fund, thus bypassing national tax jurisdictions.
Of course many, having stashed great wodges of cash elsewhere collecting healthy interest are now terrified that the new European Legislation abolishing the right to banking privacy, known as the “Withholding tax” directive or in Commissionese “taxation of savings income in the form of interest payments”. This tax was brought in order to, as is described with masterful understatement by the Association of Chartered Certified Accountants, “is to eliminate what the Commission refers to as ‘harmful tax competition in the European Union’”.
Whatever, many are the officials who, are going to get badly burnt by their national tax authorities when their banks are forced to hand over financial information starting at the beginning of July. After all it is reasonable to guess that they have not really been following all developments in the field of real world taxation, specially when they pay the EU institutional rates (somewhere between 8 and 16% depending on experience and wages).
This of course will result in a whole tranche of cases of tax dodging officials being charged across Europe. Which in its own way will provide the millions of untertanen (oops sorry European citizens) with some enjoyment over the coming few years.

The Maitre’s suggestion? Buy property in Belgium and let it out. Income from property in Belgium is soon to become the last untaxed income in Europe. Yes their maybe some increased rates, but he suggested that the Belgian authorities, ahem, probably wouldn’t notice if one didn’t tell them.

Other gems gleaned from the day.
Flanders has abolished TV licences. (In Brussels region the crafty bastards have intermingled them with the rates – so everybody pays a TV licence, radio and Car radio tax whether owning a TV or not; you could own a TV, that is enough. Dammit, I don’t even own a car and I am paying car radio tax!).

Now that they are forced by the EU to pass on your financial details banks are now tax collecting authorities, and in the immortal words of the Samizdata Community, “are not your friend”. So it’s back to the luggage under the bed then.

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