European Union leaders will turn to one of the most crippling parts of the region's economies - tax dodging. Given the size of the underground economies in Spain and Greece, missing taxes are a large portion of the taxable revenue base. Even in the United States, what the IRS collects is only a portion of the real, total income of people. Europe's problem is that most countries have no mechanism to detect who cheats, let alone how to collect money from them. That means the decision to improve the system likely lacks teeth.
Bloomberg reports on efforts to fight tax evasion in the EU:
The agenda for this week will include stepping up the fight against tax evasion after finance ministers from Luxembourg and Austria last week blocked efforts to reach agreement on sharing tax data. The accord aims to set standards for how countries collect data on income residents earn in other nations.
"Priority will be given to efforts to extend the automatic exchange of information at the EU and global levels," according to the draft.
So, it may be as hard to get an agreement as it will be to implement it.
Filed under: 24/7 Wall St. Wire, Economy, Tax