What’s the Deal with the European Union?

Jun 12

Unless you live under a rock, it is likely that you have heard about the latest issues with the European Union. The shortest way to describe the current political situation is: the European Union — and Britain’s relation to the European Union — is a mess.

There is an international populist movement gaining steam across the globe. Oftentimes, the populist uprising is in reaction to globalization, multilateral agreements, changing cultural norms, and a whole host of other reasons. Most of the candidates and parties have been associated with the political right, no matter the country’s particular political context.

One of the manifestations of this populism in Britain was the Brexit campaign. Former Prime Minister David Cameron promised a nationwide referendum before leaving office, concerning the exit of Britain from the European Union.

The prime minister promised this referendum (or vote) because of intense public pressure. Many populists and conservatives (and to be fair, some left-leaning officials, too) in Britain are skeptical of the benefits that membership in the European Union offers to Britain.

As a multinational political and legal coalition, the European Union acts almost similar to the United Nations. However, membership is (obviously) limited to European countries. And while the coalition has obvious benefits such as a shared marketplace in which tariffs or trading taxes are limited or non-existent, there are also obvious downsides.

The most commonly cited negative effects of being a European Union member state is mandatory regulations on goods and services that must be complied with, lest a member state receives fines or in severe cases, be threatened with removal from the European Union.

These regulations, in addition to immigration requirements, were the primary reason that Brexit campaigners persuaded the British people, by a slim margin, to vote to leave the European Union.

As the team at THEVOZ Attorneys, LLC describes on their website, there is a compelling case to be made that the European Union’s tax structures are pretty difficult to navigate. As they point out, even basic business transactions involving the European Union’s member states could require an international tax lawyer that is experienced with navigating the bureaucracy.

While I am not in any position to offer an opinion on the broader Brexit campaign or the issues discussed by the Brexit campaigners and those opposed to the exit, the “Remainers”, I do feel entitled to an opinion on the complexity of the tax system.

From what I can gather, it seems that if you are doing business in one European Union member state, you might be obligated to:

  • Comply with local tax regulations in one instance
  • And the very next day, you might be obligated to instead comply with the international financial rules.

This system is definitely not enjoyable to navigate over any lengthy period of time.

Until the system is reformed or there is an easier way to understand which laws you must follow, I would sincerely recommend that you speak with an international tax lawyer who is experienced with doing business in the European Union. Receiving their legal counsel might be the thing that prevents a serious mistake or miscalculation on your part!

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