The Fiscal Anatomy of a Regulatory Polity: Tax Policy and Multilevel Governance in the EU

Abstract

Diese Arbeit ist im Sonderforschungsbereich 597 "Staatlichkeit im Wandel", Bremen, entstanden und wurde auf dessen Veranlassung unter Verwendung der ihm von der Deutschen Forschungsgemeinschaft zur Verfügung gestellten Mittel veröffentlicht.Sfb 597 "Staatlichkeit im Wandel" -"Transformations of the State" (WP 114) The Fiscal Anatomy of a Regulatory Polity: Tax Policy and Multilevel Governance in the EU ABSTRACTThe paper analyzes the common assumption that the EU has little power over taxation.We find that the EU's own taxing power is indeed narrowly circumscribed: its revenues have evolved from rather supranational beginnings in the 1950s towards an increasingly intergovernmental system. Based on a comprehensive analysis of EU tax legislation and ECJ tax jurisprudence from 1958 to 2007, we show that at the same time, the EU exerts considerable regulatory control over the member states' taxing power and imposes tighter constraints on member state taxes than the US federal government imposes on state taxation. These findings contradict the standard account of the EU as a regulatory polity which specializes in apolitical issues of market creation and leaves political issues to the member states: despite strong safeguards, the EU massively regulates the highly salient issue of member state taxation. Sfb 597 "Staatlichkeit im Wandel" -"Transformations of the State" (WP 114) CONTENTS

Cigarette excise tax policy in the Western Balkans: Trends, effects and challenges

“…This is explained by simultaneous impact of several mechanisms: i) stronger incentives for tax competition between the member states (facilitated by the four basic freedoms); ii) imposed policy coordination from the supra-national (EU) level; and iii) learning effect -facilitated exchange of knowledge and information on comparative policies (Holzinger and Knill, 2005). This is in accordance with the findings of Genschel and Jachtenfuchs (2009) that frequency of legislative acts on tax issues surged over time, especially since formation of the single market. Although, taken in total, convergence in tax policy has been captured, empirical literature indicates different patterns with regards to convergence of direct and indirect taxes.…”

Multiple streams, leaked opportunities, and entrepreneurship in the EU agenda against tax avoidance

“…European developments are not analyzed in a comprehensive manner. This is striking, considering the growing influence of the EU as a global actor (Smith, ) and the substantial regulatory influence of the EU on taxation (Ganghof & Genschel, ; Genschel & Jachtenfuchs, ).…”

“…The European Community has been concerned with the issue of tax coordination and harmonization ever since its foundation in the 1950s. The Spaak report from 1956 already acknowledged the need to coordinate the tax policies of member states in order to complete market integration (Genschel & Jachtenfuchs, ). Since then, the European Commission has been an energetic proponent of a supranational solution to tax problems and the definition of a common tax base, starting with the Neumark report of 1962 and the Van den Tempel report of 1970 (Radaelli, ).…”