Letter: Europe: in or out

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The Independent Culture
Sir: Lord Howe and the other signatories of the European Movement's letter (30 November) should know better. Tax harmonisation is not an optional extra in the single currency area. It is an essential element of the single currency project without which it will fall apart.

Supporters of Britain joining the single currency talk glibly about the benefits to British consumers of the price transparency that would result (they obviously assume that we cannot use calculators).

They ignore the social and economic damage that will be caused by tax transparency unless taxes are harmonised. People living within a single economy, with a single market and a single currency, must face the same tax rates throughout, otherwise there will be social unrest as people in one part of the economy complain that their tax rates are higher than those paid by their neighbours in another part of the same economy.

The other obvious result of variations in tax rates is that companies will tend to move to areas of lower taxation, causing unemployment in areas of higher taxation. Herr Lafontaine is only too aware of that, which is precisely why he wants to "harmonise" our tax rates with those in the single currency area.


Brentwood, Essex