Monday, June 7, 2004

Guest blogger Walter Schwidetzky (Baltimore) shares his final report on the Paris meeting of the European Association of Tax Professors (see his first report here):

One of the issues facing the EU countries is how to deal with the fact that they have a variety of tax systems but are subject to the jurisdiction of the EJC that can issue rulings that can require them to change their tax laws. Uniform tax systems across the EC would aid in the formation of a common market, and one question that arose at the conference is whether thre was some basis for developing a common system. One proposal in this regard was internatinal accounting standards currently usually used by larger companies. Indeed, something similar to that exists in the UK, and a UK representative gave a talk in this regard. The UK apparently incorporates some mark to market rules as do the accounting standards, and there was a discussion of the viability of this and whether it was appropriate to move away from realisation principles, particularly in light of the fact that most EC businesses are small. A concern was also expressed of whether accounting rules developed by a private body (IATLB) were an appropriate starting point for democratically enacted statutes, and some felt that the rules were too business friendly. There would also inevitably be pressure on the various governments to engage in various tax expenditures in the context of each country’s political dynamic; making it difficult to maintain consistent rules across the EC.

The overall level of the discussion was high and rather more formal than would have occurred in the US (as was the dress). There were about 7 US Tax Pros at the meeting.