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"Foreword" [2020] ELECD 156; in HJI Panayi, Christiana; Haslehner, Werner; Traversa, Edoardo (eds), "Research Handbook on European Union Taxation Law" (Edward Elgar Publishing, 2020) xiv

Book Title: Research Handbook on European Union Taxation Law

Editor(s): HJI Panayi, Christiana; Haslehner, Werner; Traversa, Edoardo

Publisher: Edward Elgar Publishing

Section Title: Foreword

Number of pages: 3

Extract:

Foreword
Koen Lenaerts

The power to tax is, without question, one of the key powers inherent in the exercise of
national sovereignty. That is because that power provides the necessary means to carry on the
business of government and to put into effect redistributive policies defining how a society is
to pursue social justice. Moreover, as the American revolutionary rallying cry ­ `no taxation
without representation' ­ neatly illustrates, the power to tax must be exercised by demo-
cratically-elected officials. Taxation, sovereignty and democracy thus go hand-in-hand.
More than 60 years ago, when the Member States of the European Union (EU) decided
to establish a new legal order, possessing its own institutions, for the benefit of which those
Member States have limited their sovereign rights, albeit in limited fields, that traditional
understanding of taxation had to be adapted to accommodate a new reality. In the EU legal
order, national powers of taxation are to be exercised in keeping with `positive' and `negative'
integration.
Positively, the EU may adopt harmonising measures in the field of taxation that directly
affect the establishment or functioning of the internal market. However, given that unanimity
within the Council is required and that the role of the European Parliament is limited to that of
consultation, the Member States still have the final say as to whether taxes should be subject to
common regulatory standards. To date, when it comes to direct taxation, the scope of EU law
itself is rather limited: unlike in the tax ...