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EU commissioner calls for cross-border co-ordination

Laszlo Kovacs, the EU tax commissioner, told member states that vast improvements are required to protect citizens and businesses from cross-border tax discrimination. If necessary, he would introduce legislation to ensure that tax policy was better coordinated between the 25 EU member states.

Kovacs has drafted papers for coordinating exit taxes, and is planning similar documents for inheritance tax, withholding tax and anti-avoidance. He believes these are necessary to untangle Europe's tax system, which hurts individuals and deters companies from exploiting the single market economies of scale.

'If such co-operation does not work then we would try with some legally binding solutions,” said Kovacs.

His warning came in response to the growing number of legal challenges to tax policy in member states.

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