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Eurostat, the Statistical Office of the European Communities, proudly reports that between 2000 and 2008 the tax and contribution ratio in the EU27 has fallen. In particular concerning the corporation tax, there would be a continuous decline of the top tax rate. What Eurostat regards as hardly worth mentioning: taxes on consumption during the same period have risen from 20.9 and 21.5 percent. Good news for business, bad news for consumers. Unfortunately, this is not the only information, which Eurostat announced on tax and contribution ratios.

Over the last years, the European Commission has repeatedly asked the Member States to lower their taxes. Successfully, as it seems: the average tax revenue in the EU27 has fallen from 40.6 percent in 2000 to 39.3 percent in 2008. Eurostat and the Commission, however, do not mention with a single word that lowering the tax and contribution ratio represents a burden on public budgets.

Between 2000 and 2008 for example, Greece has reduced her tax revenue from 34.6 to 32.6 percent of the Gross Domestic Product - in spite of budget deficits and high national debt. Other highly indebted EU countries such as Italy or Portugal apparently did not go down the same route. In Portugal, the tax and contribution ratio increased from 34.3 to 36.7 percent; in Italy, it rose from 41.8 to 42.8 percent.

Who benefits from the falling tax rates? Obviously mainly companies and top earners: the top corporation tax rate fell from 31.9 percent in 2000 to 23.2 percent in 2010. During the same period, the top income tax rate fell from 44.7 to 37.5 percent. This appears positive at first glance, but in order to benefit from the reduction of the top tax rate, one has to be a top earner. In Austria for example, only those pay the top tax rate of 50 percent, who earn more than € 60,000 gross per year (after the deduction of the social security contributions).

Less positive is the development of a tax, which every consumer has to pay - Value Added Tax: during the period between 2000 and 2010, it rose EU27-wide from 19.2 to 20.2 percent.

In Austria, the tax revenue (period 2000 to 2008) fell slightly - by 0.4 percent. In accordance with Eurostat, the labour tax in Austria rose from 40.1 to 41.3 percent, whilst corporation tax was reduced from 34 to 25 percent.

Conclusion: over the past years, high earners in the EU have enjoyed reduced taxes, whilst the tax and contribution ratio for low earners is even higher than 10 years ago. There is reason to fear that this trend will be continued in the course of consolidation efforts of the public households at EU level.