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The Role of Taxation in the European Union Sovereign Debt Crisis

This study analyzes the current tax systems in the European Union (EU) mainly by focusing on the diversities of taxes levied on labour, consumption and capital. It is shown that the tax structures of the Member States are considerably different from each other. Further the role of tax policy in the European sovereign debt crisis is evaluated. It is considered that although taxation can not be deemed as one of the causes of the crisis, some tax policies pursued during the pre-crisis period may have contributed to the causes of the crisis. Additionally, the measures taken to cope with the crisis at the EU level and at the national level are discussed in detail.