“We have got a monetary federation. We need quasi-budget federation as well …
We need quasi-federation of the budget.”
– European Central Bank President Jean-Claude Trichet, The Guardian, 1-12-2010
“I deeply respect our Irish friends’ independence … but they cannot continue to say ‘come and help us’ while keeping a tax on company profits that is half [that of other countries]. We cannot speak about economic integration without the convergence of fiscal systems.”
– French President Nicolas Sarkozy, The Irish Times, 14-1-2011
“We have a shared currency but no real economic or political union. This must change. If we were to achieve this, therein lies the opportunity of the crisis …
And beyond the economic, after the shared currency, we will perhaps dare to take further steps, for example for a European army.”
– German Chancellor Angela Merkel, Open Europe international press survey, 13 May 2010
“The two pillars of the Nation State are the sword and the currency, and we have changed that.”
– EU Commission President Romano Prodi, The Guardian, 1999
Next month, March 2011, the EU Commission will propose supranational legislation for a uniform system of assessing business taxes in the EU – a Common Consolidated Tax Base.
This proposal for what are called “destination taxes” will undermine Ireland’s 12.5% company tax rate. It put on hold in 2008 and 2009 to help get the Lisbon Treaty referendums through in Ireland.
The idea is that firms selling goods in different EU countries would pay corporation tax to those countries’ governments based on the profits on their sales in those countries, and not to the government of the country where the goods were originally made, as happens now.
Countries would continue to decide their own tax rates as at present. This means Ireland could keep its 12.5% Corporation Profits Tax for profits made on sales in Ireland, but not on profits made on sales abroad. The attraction to foreign investors of Ireland’s low corporation tax regime would be fundamentally subverted by this step, for most of their profits would be taxed in the countries where their goods or services were sold and not in Ireland where they are produced.
This step does not require unanimity amongst all 27 EU States. It can be done by a sub-group of nine or more Eurozone States under the “enhanced cooperation” provisions of the Treaty of Nice, even though many or most of the other EU Members are against it. The EU institutions can then be used to advance further integration by this sub-group. This provision drove the proverbial coach and horses through the notion which some people believed in: namely, that the EU is some kind of “partnership of equals” in which no fundamental change can be made without all 27 Member States agreeing.
In March too the European Council will finalise arrangements for an amendment to the Lisbon/EU Treaties to set up a permanent “Financial Stabilisation Fund” from 2013, to which Ireland would be expected to contribute, without allowing the Irish people to vote on it in a referendum.
The German paper Handeslblatt reports that a “historic” change of EU policy is now under way in Berlin, with Germany no longer opposing Eurozone economic government. The new plan envisages the 17 Eurozone countries being pushed towards “harmonization” of their State Budget policies. On taxation levels, wages of public officials and retirement ages, Eurozone countries would have to commit to binding common “bandwidths”, with penalties such as fines for any breaches.
The EU/IMF loan – better called a “stitch-up” rather than a “bail-out”! – that was pushed on the Irish Government by the European Central Bank last November puts Ireland in a weak position to resist these further transfers of power to Brussels and Frankfurt. They underline once more the folly of our joining the Eurozone in 1999, when we could have stayed outside it like 11 of the 27 EU Member States.
It is now clear to all thinking people that joining the Eurozone was the worst and most irresponsible decision of any Irish Government – ever.
The politicians of the three main parties who pushed that ruinous course upon us are the real perpetrators of “economic treason” in Ireland, of which our emigrating young people, our 400,000 unemployed and our debt-ridden households are the manifest current victims.
N.B. Note that from 2014, just three years time, the Lisbon Treaty/EU Constitution which was also pushed on us by Fianna Fail, Fine Gael and Labour will put EU-law making on a straight population basis, with Germany’s vote on the Council of Ministers doubling from its present 8% to 17%, France’s, Britain’s and Italy’s vote going from their present 8% each to 12% each, and Ireland’s falling from its present 2% to 0.8%.
The proposals mentioned above are but a foretaste of many more EU diktats to come, once Germany, France and the other big EU States obtain this big increase in their EU law-making power.
(11 February 2011)