HARMONIZATION OF TAX SYSTEMS IN THE EUROPEAN UNION
Keywords:
Tax systems, harmonization, taxes, fees, directives, EUAbstract
Throughout history, tax systems have differed from one another in many ways, including their historical, economic, and legal foundations. As a result, fiscal harmonization has emerged as an alternative approach to fiscal federalization of countries as compared to their national regulation. In countries with economic and fiscal disparities, as well as at the international level, fiscal differences have significant impacts on issues such as international trade, currency exchange rates, migration of people and capital, etc.
Even though all economies of the EU member states are part of an economic integration, which is all expressed in the free movement of goods, services, capital and labour, as main economic principles and values of the European Union. Article 93 of the Treaty of Rome defines the ability for member states to have complete independence in the free development of tax policies, including the application of special types of taxes like direct and indirect taxes, despite being subject to certain tax harmonization measures undertaken by EU member states. The article states that: "The Council shall, acting unanimously on a proposal from the Commission and the Economic and Social Committee, adopt provisions for the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation to the extent that such harmonisation is necessary to ensure the establishment and the functioning of the internal market".
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The World Trade Organization (WTO) is an international organization based in Geneva , Switzerland, which deals with the promotion and enforcement of international trade laws and regulations. The WTO has the authority to administer and oversee free trade agreements and global trade practices, and examine and settle trade disputes between member countries. The WTO was founded in 1994 when countries tha were members of GATTsigned a new trade treaty. The WTO was established to replace the GATT. The WTO began work on January 1 1995.
The Organisation for Economic Co-operation and Development (OECD) is an intergovernmental organisation with 38 member countries, founded in 1961 to stimulate economic progress and world trade. It is a forum whose member countries describe themselves as committed to democracy and the market economy, providing a platform to compare policy experiences, seek answers to common problems, identify good practices, and coordinate domestic and international policies of its members.
