3 ms·

The European Union works reasonably well, the problem is with the Euro. Not currency union can work properly without a fiscal union.

TheOtherHobbes 8y ago
The EU is still mostly a good thing. The Euro is a disaster - swivel-eyed lunatic neoliberal orthodoxy enforced by a common currency. The irony is that the so-called single market is a mess too. While it's possible to sell across country borders in the EU, the bureaucratic necessities - especially VAT accounting - make it a horror show. Eliminating customs bureaucracy is a good thing, but that's still a long way short of true friction-free trade.
- toyg 8y ago
  > the bureaucratic necessities - especially VAT accounting - make it a horror show. EU VAT accounting is actually fabulous for real goods: intra-union transactions are VAT-free, so each state can levy whichever rate they prefer on the final sale. Everyone is happy and there is less red tape. They fucked up for digital goods and services because the model simply does not map well to that domain - the internet has no border. Politicians felt they had to make a choice between losing VAT income altogether (which is what was happening before, with companies tactically exploiting low-VAT countries) or creating some friction for digital businesses. They picked the most rational option. In reality, it's a false dichotomy, and everyone knows it. The real way out is a simplification where that tax is centralized at federal level; but it requires a huge amount of political capital, that the current generation of European politicians is completely incapable of generating on their own. At some point, someone will run in France or Germany on this platform of simple, flat VAT rates on digital income across the EU, accumulating to an unified EU treasury that can then be used to further generate income; they will win, and it will come to pass.

TheOtherHobbes 8y ago

The EU is still mostly a good thing. The Euro is a disaster - swivel-eyed lunatic neoliberal orthodoxy enforced by a common currency. The irony is that the so-called single market is a mess too. While it's possible to sell across country borders in the EU, the bureaucratic necessities - especially VAT accounting - make it a horror show. Eliminating customs bureaucracy is a good thing, but that's still a long way short of true friction-free trade.

toyg 8y ago
> the bureaucratic necessities - especially VAT accounting - make it a horror show. EU VAT accounting is actually fabulous for real goods: intra-union transactions are VAT-free, so each state can levy whichever rate they prefer on the final sale. Everyone is happy and there is less red tape. They fucked up for digital goods and services because the model simply does not map well to that domain - the internet has no border. Politicians felt they had to make a choice between losing VAT income altogether (which is what was happening before, with companies tactically exploiting low-VAT countries) or creating some friction for digital businesses. They picked the most rational option. In reality, it's a false dichotomy, and everyone knows it. The real way out is a simplification where that tax is centralized at federal level; but it requires a huge amount of political capital, that the current generation of European politicians is completely incapable of generating on their own. At some point, someone will run in France or Germany on this platform of simple, flat VAT rates on digital income across the EU, accumulating to an unified EU treasury that can then be used to further generate income; they will win, and it will come to pass.