How can you be sure the European Assembly will adopt a Budget of the type you propose?

November 27, 2018 12:13 pm Published by

By definition, we cannot know in advance what the European Assembly will adopt. But we are convinced that the only way to move Europe forward is to have confidence in democracy.

At the moment, given the rule of fiscal unanimity there is no possibility of adopting common taxes to reduce the inequalities in Europe. With the European Assembly and the TDEM, this possibility will exist. At worst, the European Assembly will not adopt any of these taxes, or else will only adopt them with extremely reduced rates, at least at the outset. But this will in no way prevent the States from continuing to follow the current fiscal policies. The European Assembly will open up the possibility of adopting common taxation and, in this case, redistributive and ecological taxes (taxes on corporate profits, on top income and assets and on carbon emissions), but will in no way affect the rights of the States.

Furthermore, all parliamentary and fiscal history shows that the establishment of parliamentary assemblies endowed with considerable fiscal powers very rapidly has an effect on political dynamics. As soon as the 16th Amendment to the American Constitution was adopted in 1913, the Federal Congress lost no time in using its new powers to adopt some of the most progressive taxes in history on income and inherited assets. On the contrary, it is the absence of federal, fiscal parliamentary power and the rivalry between national Parliaments which explains why, since the 1980-1990s, Europe has witnessed an overall lowering of taxation rates on corporate profits, while the Federal Congress in the USA maintained an IS (additional tax) at 35% (until recently) over and above the State taxes. If a European Assembly had the power, it is probable that it would choose to tax corporate profits at a high rate to proactively involve the most powerful economic actors, in response to the demand of by far the majority of European public opinion, right across the political spectrum.

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This post was written by admTDEM