Anarchy in the UK
Really good music, but also a portent of things to come....
You see, the EU's Court of Justice is reviewing a little case that threatens to blow up in Gordon Brown's hands/face. No, it is not a case involving the UK directly, instead it arises out of some Cheeseheads from the Netherlands wanting to import some French wine they bought on holiday. The only catch was that they did not accompany the wine home. So it becomes an importation matter -- and the Dutch government wanted to tax the wine bought in France. The advocate-general's decision (upheld on appeal approximately 80% of the time) is that the Dutch goverment has no right to re-tax or tax the wine at all. In fact, the AG's ruling basically states that only the taxation rate of the country of origin (within the EU) can apply.
Hmmmm. So what does that mean? It means the the Brits, who have the highest (or almost) excise tax across the board on all their sinful consumption, can order their ciggies from Latvia where a carton of smokes cost about $12 as opposed to $70 they get charged for the same smokes in the UK. And wine can be bought by internet from France (or Bulgaria or Romania which do not tax wine at all) and shipped to the UK. The loss to the UK treasury? About Stg. 15 BILLION per year. And that is only smokes and booze. Think about the insane taxes and levies put on electronic goods.
This places Britain in a tough place: they depend on the absurd punishment of the "wicked" and "sinful" for large sums of cash. They gouge consumers in every which way imaginable. And the money is spent. Where it all goes is not clear, but rip-off Britain manages to do it. It occurs to me that this decision -- which leads Europe down the road of harmonization of taxation and therefore monetary policy -- will eventually force the hand of not only the UK, but many other core EU nations to REALLY look at where they are going.
You see, maybe Romania (or pick your Eastern choice) doesn't NEED the booze tax, because its system of welfare support and ministries for everybody and everything is FAR less generous than, say, Germany's. You create a net bleed to the East and financial debt/death spiral in the West. If the Polish plumbers are willing to work twice as hard as the French, and the Latvians sell ciggies dirt cheap, where is the money going to come from to support the social welfare states that have been so lavish in the past? Are you going to see the French take home less pay and fewer vacation days? Raise the taxes on income until it hurts? Or cut and run from the system? For the UK, it is still feasible, for France and Germany ... a lot tougher.
Now, of course, it doesn't HAVE to be this way. The EU can collectively decide to adopt the American (hahahahahahahahahah) way and federalize. Yes that would mean that Joe Bulgarian has a vote just like Manfred Kraut. Hahahahahah. I can just see the steam rising from the collective German head as people in the European version of banana republics vote to cut themselves more of the collective pie. Just as in the US, the voices have spoken to put Pelosi and her gang of lefties in the driving seat. Yes, that does mean that we will all pay for tax inreases and Pelosi will try very hard to start to move the US to the EU model where the government is NOT accountable to the people.
But in two years, if Pelosi can be exposed as the stealth commie she is, we can vote her out of existence. As speaker, if she blows it, she could even lose her seat -- though given the insanity that poses for rational thought in San Francisco, that would be unlikely. But remember Newt Gingrich.... Now, in the EU, it is not so clear. Once in motion, there is precious little to stop the radicals and unifying forces from getting their way. Especially if you are part of the Euro. So, if the UK were to get cold feet once their new and improved taxation system works to destroy "rip-off Britain" -- they could, just, pull out.
Some more thoughts on the UK....
The Bank of England jacked rates again. While we here in the US (Boston in particular) have had something of a housing bubble, the south of England has had a stratospheric rise in property values over the last 10 years. Just barely in orbit. The result is that there are LOTS of people with no-principal mortgages, trick ballon mortgages, home equity loans -- the usual stuff. All predicated on an ever-increasing valuation of the market and low interest rates. Guess what? Rates are NOT going to work in your favor ... particularly with the coming taxation fiasco.
DO I advoate getting the hell out of Clapham (South London Dodge) right now while you still can? Well ... yes, actualy. But lets be clear, London is a separate beast entirely. Every crook/businessman from Russia, Malaysia and parts East and West (to say nothing of Middle East) wants to have a pad in London. So the property market there will hold up the longest. But what will happen in the dominoe effect from edges, the marginal lands and properties: as rates and budget woes beset Britain, those clever mortgages etc., will cause people to sell -- at ever lower prices. And in a wave headed towards Hyde Park, we will see prices adjust to rational levels. It will happen. And the silly AG's decision might just be the straw that does it.
You see, the EU's Court of Justice is reviewing a little case that threatens to blow up in Gordon Brown's hands/face. No, it is not a case involving the UK directly, instead it arises out of some Cheeseheads from the Netherlands wanting to import some French wine they bought on holiday. The only catch was that they did not accompany the wine home. So it becomes an importation matter -- and the Dutch government wanted to tax the wine bought in France. The advocate-general's decision (upheld on appeal approximately 80% of the time) is that the Dutch goverment has no right to re-tax or tax the wine at all. In fact, the AG's ruling basically states that only the taxation rate of the country of origin (within the EU) can apply.
Hmmmm. So what does that mean? It means the the Brits, who have the highest (or almost) excise tax across the board on all their sinful consumption, can order their ciggies from Latvia where a carton of smokes cost about $12 as opposed to $70 they get charged for the same smokes in the UK. And wine can be bought by internet from France (or Bulgaria or Romania which do not tax wine at all) and shipped to the UK. The loss to the UK treasury? About Stg. 15 BILLION per year. And that is only smokes and booze. Think about the insane taxes and levies put on electronic goods.
This places Britain in a tough place: they depend on the absurd punishment of the "wicked" and "sinful" for large sums of cash. They gouge consumers in every which way imaginable. And the money is spent. Where it all goes is not clear, but rip-off Britain manages to do it. It occurs to me that this decision -- which leads Europe down the road of harmonization of taxation and therefore monetary policy -- will eventually force the hand of not only the UK, but many other core EU nations to REALLY look at where they are going.
You see, maybe Romania (or pick your Eastern choice) doesn't NEED the booze tax, because its system of welfare support and ministries for everybody and everything is FAR less generous than, say, Germany's. You create a net bleed to the East and financial debt/death spiral in the West. If the Polish plumbers are willing to work twice as hard as the French, and the Latvians sell ciggies dirt cheap, where is the money going to come from to support the social welfare states that have been so lavish in the past? Are you going to see the French take home less pay and fewer vacation days? Raise the taxes on income until it hurts? Or cut and run from the system? For the UK, it is still feasible, for France and Germany ... a lot tougher.
Now, of course, it doesn't HAVE to be this way. The EU can collectively decide to adopt the American (hahahahahahahahahah) way and federalize. Yes that would mean that Joe Bulgarian has a vote just like Manfred Kraut. Hahahahahah. I can just see the steam rising from the collective German head as people in the European version of banana republics vote to cut themselves more of the collective pie. Just as in the US, the voices have spoken to put Pelosi and her gang of lefties in the driving seat. Yes, that does mean that we will all pay for tax inreases and Pelosi will try very hard to start to move the US to the EU model where the government is NOT accountable to the people.
But in two years, if Pelosi can be exposed as the stealth commie she is, we can vote her out of existence. As speaker, if she blows it, she could even lose her seat -- though given the insanity that poses for rational thought in San Francisco, that would be unlikely. But remember Newt Gingrich.... Now, in the EU, it is not so clear. Once in motion, there is precious little to stop the radicals and unifying forces from getting their way. Especially if you are part of the Euro. So, if the UK were to get cold feet once their new and improved taxation system works to destroy "rip-off Britain" -- they could, just, pull out.
Some more thoughts on the UK....
The Bank of England jacked rates again. While we here in the US (Boston in particular) have had something of a housing bubble, the south of England has had a stratospheric rise in property values over the last 10 years. Just barely in orbit. The result is that there are LOTS of people with no-principal mortgages, trick ballon mortgages, home equity loans -- the usual stuff. All predicated on an ever-increasing valuation of the market and low interest rates. Guess what? Rates are NOT going to work in your favor ... particularly with the coming taxation fiasco.
DO I advoate getting the hell out of Clapham (South London Dodge) right now while you still can? Well ... yes, actualy. But lets be clear, London is a separate beast entirely. Every crook/businessman from Russia, Malaysia and parts East and West (to say nothing of Middle East) wants to have a pad in London. So the property market there will hold up the longest. But what will happen in the dominoe effect from edges, the marginal lands and properties: as rates and budget woes beset Britain, those clever mortgages etc., will cause people to sell -- at ever lower prices. And in a wave headed towards Hyde Park, we will see prices adjust to rational levels. It will happen. And the silly AG's decision might just be the straw that does it.
posted by Zaphod at Sunday, November 12, 2006
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