Thursday, 12 August 2010

EU tax: Discussing a part of a fraction of public spending

Total government expenditure in EU-27 during 2011 is forecast at 50.3 per cent of gross domestic product (GDP), according to the publication Public Finances in EMU 2010 (European economy 4/2010).

The draft budget of the European Union for 2011 (DB) corresponds to 1.14 per cent of EU gross national income (GNI), which amounts to EUR 142.6 billion in commitment appropriations.

Very roughly, the EU’s public spending is one 44th part of total public spending in the European Union.

Federal government spending in the United States of America is estimated to be 25.06 per cent of GDP in the financial year 2011.

The cumulative sum of European Union spending is important, but only a tiny fraction of what the US government spends as a proportion of wealth creation.

Still, some people are deluded enough to believe that they live in a centralised European super-state.

Before we see the concrete options, we can only guess that the coming proposal on an EU tax would concern only a part of the minuscule proportion of total public spending the European Union budget stands for in Europe.

Ralf Grahn

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