Friday, 24 October 2014

2.1bn euro sex and drugs tax

My first thought on hearing the news this morning was that there are people in the European Commission who would like to guarantee a UKIP gain in Rochester and Strood at the end of the month.

It seems that adjustments to EU budget contributions are made continuously on the basis of recalculations of GDP. Better people than I have commented on the flaws in GDP as a measure of the health of a nation's economy. Further suspicions were raised when I saw which other nations are expected to contribute to the poor suffering Germans and French: Greece, Italy and Spain, the most struggling of EU economies  at present. They just happen (along with ourselves) to have had their GDP estimate boosted by the inclusion of the black economy.

David Cameron has clearly taken the right decision in calling an emergency finance ministers meeting. It would be wrong simply to sulk and refuse to pay without exhaustive discussion of the basis of assessment. There would be precedent for ignoring an EU invoice, though: Germany and France both broke the Stability And Growth Pact in the early years of the century and as far as I know have never stumped up the fine which should have resulted.

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