Taxes

At the beginning of October, England became the last constituent part of the United Kingdom to introduce a compulsory charge for plastic shopping bags (to be paid by the shopper), after similar taxes had been introduced in Scotland, Wales and Northern Ireland in previous years. The relevant ministry insists that it is not a tax since “the money from the charge does not go to the government“.

We show that
A) it actually is a tax, in spite of government protestations,
B) its complexity is costly misdirected, and
C) instead of improving the environment, the tax may actually worsen it.

“Fair tax(es)” is a beautiful idea everybody wants to subscribe to. Including, of course, modern EU politicians. Their idea of “fair tax”, however, differs very much from the way in which people understood the concept in the past.
It is no longer about making sure the tax is fair to the taxpayer. It is much more about making sure that the taxpayer pays “her fair share”, meaning “enough”.
This is a dangerous development.

The imagination of EU governments to come up with new kinds of tax is apparently inexhaustible. Tax on meat is now being prepared, as an answer to alleged “problems” with meat production and consumption. But taxes are generally bad solutions to “problems”, especially when those problems are created by other government activities.

If it wasn’t obvious already, Greeks do their taxes differently.. They rely more than is customary in OECD on the less visible taxes of VAT and Social Security. Income tax revenue (from people and companies) is much less prominent. If they are risking a lot less, it time to try to actually lower the income tax rate?

New retail tax in Hungary discriminates big business, which just happens to coincide with the finance minister’s nationalistic interest. New retail tax in Czechia favours big business, which just happens to coincide with the finance minister’s business interest. Curious thing, Coincidence…

You’ve heard of Bitcoin. Is it primarily a currency or a service? Its users probably could not care less; for many it will be both. Yet a distinction is necessary.…

Two recent stories from Greece reveal very different treatments of Germans paying taxes in Greece – depending on whether they are people or corporations.

So you thought you could have your cake and eat it. That you reduce tax on something which has benefitial implications for a disadvantaged social group, saves resources and is good for the environment. Think again, says the EU Court. Your young ones are, apparently, not a legitimate aim of social policy. (And you didn’t declare the goal in your law! Off with you!)

In all epochs, exports were almost always considered good for an economy. That’s why modern governments have generally stayed away from trying to tax exports. Not so the current Greek government, however. By increasing the tax rate on a vital component of Greek exports it is hoping to raise some “free revenue”. It won’t work.

An age-old phenomenon: Some unemployment exists and politicians want to fight it by creating conditions for new jobs. The usual recipe involves expanding government spending and investment programs. Figures for OECD countries show that places with low taxation of labour tend to exhibit low unemployment low and high levels of individual annual work hours. For politicians this serves as a much more promising recipe for politicians: the best way of “creating conditions for new jobs” and lowering unemployment is to reduce the tax burden on labour.