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More on being “isolated” from the eurozone car crash

“Yes indeed, Britain is on the outside: left out of this idyll of anti-competitive regulation and tax harmonisation. I can remember when the greatest Eurosceptic nightmare was a “United States of Europe”. They should be so lucky. The United States of America has nothing like this ferociously imposed central control over the budgets of its member states. Nor does it require tax harmonisation among them. The states of the American union have independent tax systems: apart from federal income tax, the taxes that US citizens pay are determined by the states they are in. Some of those states have high property and death taxes – others (like Nevada, where the revenue from gambling pays for almost everything) have low ones. Some have sales taxes and specific duties which others do not. Hence the great American tradition of driving across state lines in order to buy cheaper alcohol.”

Janet Daley.

5 comments to More on being “isolated” from the eurozone car crash

  • Gareth

    What they are doing is positioning the EU trading bloc as ‘competitive’ versus other trading blocs to attract foreign business at the expense of existing businesses already here and at the expense of internal competition – the benefits of harmonisation mean you can set up anywhere on the continent.

    Internal competition and innovation is being stifled by the very policies the EU claims will promote competition and innovation. If everyone is regulated and subsidised onto a level playing field there is little incentive to prosper.

  • Rob H

    Which provokes the image of a future where the UK is the beneficiary of Alchohol tourists from France, Belgium and Holland booze cruising over to buy their Chilean Christmas plonk!

  • Bad analogy, though, obviously. It’s true enough that US states don’t have tax harmony imposed on them, but then the federal cut of any citizen’s tax bill is the lion’s share. And since the Commerce Clause can be interpreted to mean almost anything (though that may be about to change), the Feds have the power to harmonize any taxes they feel like harmonizing. Not to mention, states depend on federal subsidies in practice, and the Federal Government frequently attaches conditions to receipt of said subsidies that interfere heavily with an individual state’s ability to set policy. Europe enthusiasts would be thrilled if the EU had as much power over its member states as Washington does over US states.

  • Thomas

    When I came to Delaware I thought I had arrived in the Land Of The Alcoholics, so big were the liquor stores. But no, it’s just the screwed-up liquor laws in Pennsylvania and New Jersey. Also, we have no sales tax here.

  • lucklucky

    UK is also hyper regulated. US too. I don’t think anyone can say my side is better. They are all (EU, UK, US) awful like we see by the economic situation.