This important study on the implications of taxation on small and medium-sized companies in the European Union is in two parts.
The first reviews, from the business viewpoint, the general structure of tax systems in the EU and their contributions to government revenues. Comparisons are included with Japan, Switzerland and the USA This leads on to an assessment of the extent to which European tax regimes have distorting effects upon the neutrality, or lack of it, between SMEs and large companies.
The second part examines the compliance burden of the VAT system upon SMEs in the EU and recommends how this might be lightened. It then examines the implications for SMEs of the changes proposed by the Commission to indirect taxes - VAT and excise duties - to come into effect with the 1992 Internal Market. Alternatives to these proposals are discussed and recommendations put forward.
Published on behalf of the European Small and Medium-Sized Enterprise Contact Group.
Book I PART ONE Background, Taxation, Government and Business PART TWO Tax Systems in the EC, Japan, Switzerland and the US Taxes on Personal Wealth and Income Taxes on Corporate Income Value Added Tax Local Taxation PART THREE The Size Neutrality of Business Taxation Some Departures from Neutrality Savings and Investment Complexity and Compliance Costs The Regressivity of Business Compliance Costs Conclusions to Part III PART FOUR Implications for Policy The Moderniztion of Taxation Book II PART ONE The Simplification of VAT The Compliance Burden Special VAT Regimes for SMEs PART TWO VAT Post 1992 The Commission's Proposals Implications for Compliance and Administration Costs Conclusion PART THREE Excise Duties Post 1992 Introduction The Current Structure of Excise Duty The Commission's Proposals General Criticism of the Proposals SMEs and the Reform of Excise Duties Alternative Proposals Conclusions Overall Summary of Conclusions