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In a free society income belongs to the people who earn it. The same applies to an ideal one, one with no inherent domestic inequalities, no unemployment, one where everybody sets off from the same starting line in the race of life. The real picture however is different. Taxation is not only the best way to alleviate extreme social inequalities, but also the only way to finance the endeavors of a social, lawfully ruled, modern state. The moral value of earned wealth sits on one riverbank and the need to implement certain social policies sits on the other. Taxation is the bridge, however. Let it be low.
Let it be low to remind taxpayers that their own effort is their own gain. Low income tax is what pushes forward the resolve to achieve more and more through a rewarding work ethic.
Let it be low to prove that a stable state needs a stable society and a stable society needs a stable middle class. The ongoing austerity in many EU member-states crushes the middle class, the economy's real workhorse, under the weight of excruciating taxation, a fact which in turn diminishes its valuable size.
Let it be low because it's proven so far that low taxation is the best incentive to cultivate a straightforward relationship between taxpayer and state. When tax is low, the associated legal risk of evading taxation becomes high in comparison to what is at stake. Little, fair tax and by all.
Let it be low to encourage a culture of saving for a rainy day, or to bring back that family driven small and medium sized investing, truly stabilizes the consumption and real estate values through home ownership. Private individuals and businesses use money more efficiently than governments do. People with their own money at risk spend or invest it carefully.
Let it be low because the notion of low taxation goes hand in hand with small government.
Let it be low because low taxation boosts economic growth: People respond to economic incentives. So, the larger government gets and the more it raises taxes, the more the economy slows down. The slower the economy moves, the higher the unemployment rate and the less competitive the business environment becomes, the more people suffer across the board.
We choose as YEPP to bring this issue up, not just because we believe in its economic value, not just because Europe needs to become more competitive, not just because of a lack of investments, of growth, of opportunity. It is time to show to the people who paid for the crisis that their efforts are finally paying off, that a better future in Europe is not just a hopeful statement but a reality. We will work hard to create national policies for lower taxation that will let the middle class, the youth and the hard-working entrepreneurs breath, grow, consume and become part of a real people-driven economy.
In order to make this happen, we need people like you, who believe in the greater cause of this campaign. We want your arguments, your story, your brave, heroic stance. We want you to become a hero in our campaign story.
Numbers show we cannot go on like this. Europe, instead of being a land of opportunity, a world-leader for production and innovation, has turned into a hostile, high-taxed, bureaucratic area. Investors won’t invest, job creators won’t create jobs, young people are afraid to start-up a business, young couples are afraid to buy a house. We need change.
Today, most of the Member States have eliminated or roughly eliminated their deficits while five Member States (Cyprus, Greece, Ireland, Spain, and Portugal) implement their economic and fiscal policies under adjustment programs jointly designed and financed by the IMF, the European Commission and the ECB. These programs (officially known as ‘Memoranda’) include detailed plans for rapid fiscal consolidation that balances between the objectives of lower spending and more revenues. But increasing revenues, the largest part of which comes from taxation, occasionally seems more feasible than decreasing spending, leading to continuous additions in taxation schemes, with negative effects for the “real” economy, the operation of markets and enterprises and the growth prospects. This policy trend comes in conflict with the commitment of the EU institutions to introduce and enhance growth-friendly tax systems.
It is proven by 23 research projects in the OECD area in the last 2 decades that lowering taxation almost always translates into GDP growth. It is proven that higher taxation stagnates the economy and reduces consumption. It is proven that even 1€ less in taxes will always bring more than 1€ in GDP. What’s left to prove is that we can add some common-sense to Europe’s taxation systems. Reform was necessary but now is the time for growth. It is time to show that the efforts of the EU citizens are paying off and that we can move to a more healthy, more competitive, more entrepreneurial economic system.
Α stable state needs a stable society and a stable society needs a stable middle class. The ongoing austerity in many EU member-states crushes the middle class, the economy's real workhorse, under the weight of excruciating taxation, a fact which in turn diminishes its valuable size.
A family, a house, a job, a good education, more opportunities and a promising future is what it means to be middle class in Europe. The unfair and high taxation that is reaching into the pockets and the earnings of middle class Europeans must be stopped. We need to reverse the rise of inequality, by allowing the middle class to breathe away from excessive taxation that stops them from consuming, saving, investing for a home, sending their children to school, creating their small business and developing their innovating ideas.
As Milton Friedman once said, ‘We have a system that increasingly taxes work and subsidizes non-work.’ When middle class families have less to spend, our businesses have fewer customers. We stand together with the struggling middle class for good jobs, higher wages, a certain future. Europeans are determined, they are resilient and they are hard working. Let’s create together a future from the rubbles of the financial crisis into a stronger, fairer and more productive economy that rewards hard work.
Let’s give every European a chance to get ahead in the 21st century and put money back into the hands of the people who consume and create jobs. We need to tell people they can keep more of their money if they can produce more of what we need as a continent and as an economy. This is what it really means to stand for a strong middle class.
If there is something we’ve learned from the recession, it’s that we cannot tax and spend our way to growth. We need to think simple. In order to have employees, we need employers. In order to have employers, we need to incentivise labour. Even if a corporation is profitable today in Europe, it is much more cost-effective and rewarding to outsource overseas or capitalise instead of creating jobs. If we want a job creation revolution in Europe, European governments need to reward job creators, not punish them with excessive taxation.
Despite wide range recognition that taxing labour has a negative effect on job creation, the tax burden on labour in Europe has increased since 2011. Research conducted by Deutsche Bank has concluded that ‘taxation on labour leads to less entrepreneurial activity and fewer innovations’ and, as a result, fewer jobs. There is room in Europe for a shift away from labour taxes to tax bases that don’t damage growth, like consumption and immovable property taxes.
If Europeans have jobs, this means they can pay taxes, spend more, consume more, create a higher income for the State. As long as the State keeps the taxes high, there will be no jobs, no taxes payed, no private spending, no consumption and very little income for the State itself. That’s why we need to tax as less as possible in order to create jobs in Europe for the most educated and skilled generation of young people in the world today. Because in the end of the day, it is the European people who create jobs, not the governments.
Europe’s SMEs are the number one contributor to the European economy, employing millions of Europeans and paying billions in taxes. Europe however is a very business-hostile environment with high taxes and high bureaucracy for SMEs. European entrepreneurs have proven that they can create world-class services and products as long as the state does not stand in their way.
We have failed so far to give back to them an environment where they are rewarded for performing well, where they can keep their capital to grow, to invest and to create jobs for Europeans.
We want to make Europe a place where more people can think ‘I want to start my own business’ and be able to do so, just that easy. European businesses can reach to markets that are untapped, to deals that remain to be closed, to opportunities that await them in the world. To seize them, they must be allowed to do so by a tax system that is low enough to encourage them and simple enough to keep them focused on what they do best.
Research indicates that eliminating distort taxes can increase growth by 4 - 8% (Jones et al, 1993. Lee and Gordon, 2005). The uncompetitive business tax climate in our Union is pushing European companies abroad, sending jobs to third countries. By minimizing the tax burden, it will become easier for European and global businesses to invest in Europe, to produce in Europe and to create jobs in Europe.
Let’s reward the businesses leaders that hire and invest, making our Union stronger and more competitive. Let’s help our entrepreneurs reach out to new markets for European goods and services, lower prices for the consumers, attract investments and create new, higher-paying jobs for European workers.
High taxes, by nature, reduce a citizens’ freedom. We must protect Europeans from inefficient government spending that is funded from high taxation, but we must also tackle tax evasion by eliminating the loopholes which allow businesses to hide their profits and avoid paying their fair share to the state.
National and European spending is often structurally and financially broken. For decades, governments have pushed past their core functions, spending on often unsustainable levels. Government officials resorted to higher taxation to mask their overspending, compromising the European competitiveness and risking the success of our single market. The legacy that is passed to young Europeans and their children should not be funding the debts of the past by taxing the innovators of tomorrow.
Reforms are not expensive, they are necessary and they are achievable. Simpler taxation will make way for cracking down on bad practices that offset profits with losses. Simpler taxation will also help eliminate tax evasion. We need to implement successful practices of collecting taxes through electronic governance while making it easy and understandable for the citizens to know what they are taxed on and how much. The more complex a tax system is, the harder it is for the state to avoid tax evasion and the easier it is for tax evaders to win over the rest of us.
Let’s implement a simple, transparent and fair tax system for individuals and for businesses. Let’s make it easier to file tax records and harder to avoid paying tax. Taxes come from the pockets of hard-working Europeans and reaching deeper in their pockets to fund government spending is not an option for us.
Lowering taxes in Europe is not as easy as it sounds. There are too many government officials, too many bureaucrats, too many special interest groups that benefit from high taxation on you and your family. Sometimes legislators forget that it is the taxpayers that make every state run by working hard and paying their bills, by consuming, saving and investing.
The first parts of our society that would benefit from lower taxes is the middle class, the youth and the hard-working entrepreneurs. This is who we want to work for. We need determined policy makers that know what’s at stake for them and go against special interests that benefit on the back of the majorities.
If you want to help us save them from excruciating taxation, call your representative and tell them that we need heroes who will put aside the political cost and propose policy for lower taxes on the Europeans. We need people like you to join our campaign, bring up their stories and their best arguments. Make a start and become a low tax hero.