Chilly Relations Growing Between Swiss and EU

Switzerland and the European Union have squared off for their latest round in an ongoing dispute over taxation. The EU has essentially accused Switzerland's policies on taxation to be 'harmful' and 'a violation of free trade agreements.'

Pope Benedict XVI certainly didn't help matters any when he issued a statement last week castigating 'some European nations' for the failure to follow EU policies on taxation.

Perhaps the Pope should learn to remain silent about matters about which he knows nothing.

The nations of the European Union are known for some of the most heavily taxed countries on earth, not to mention their penchant for promoting, implementing, and funding massive cradle-to-the-grave nanny-states that are known for rewarding mediocrity and undercutting every known natural human motive for productivity.

The one oasis in this vast human desert of irrationality has been Switzerland. As we reported last week on The Liberty Sphere, Switzerland has become a target of leftists and their allies among immigrants. Apparently, a vibrant economy, a strong defense that depends on individual armed citizens, and a rugged individualism that insists on democratic values are an affront to those who prefer the collectivism of big government.

Not only does the EU have its underwear in a bunch over Switzerland, but now even the Pope thinks he should weigh in on the decisions of a sovereign nation that has been no threat to anyone in its history, except to those who despise liberty.

Relations between Switzerland and the EU began to chill even further when two major corporations, Kraft Foods, Inc. and Proctor and Gamble Co. shifted their European headquarters to Switzerland.

The reason? Taxation.

Many of Switzerland's cantons exempt or partially exempt from taxation corporate profits that are generated outside the country. Not so in the EU.

Thus, rather than take a rational, pragmatic approach to keeping such corporate giants within the EU by amending its policy on taxation, the EU instead meddles in the affairs of a sovereign nation by demanding that Switzerland amend its policy on taxation to mirror that of the nations within the EU.

Predictably Switzerland is incensed. And rightly so. After all, would you as an American willingly accept the demands of a nation such as Denmark to dictate to us our policy on taxation?

Further, what if Denmark were upset that our taxes were not collected at the rate of roughly 50% of our income?

And by the way, Denmark's highest scale of taxation stands at 68%.

Observers of world politics and economics believe that the present skirmish between the Swiss and the EU signals a long period of very chilly relations between the two. The Swiss have already capitulated to outside demands by somewhat liberalizing their policies on the disclosure of financial information collected by its banks.

Switzerland's long-standing policy of complete privacy for investors in its financial institutions has been under attack by the EU and the rest of the world. In order to be perceived as a 'good neighbor' by the international community, Switzerland has begun to disclose some financial information to international law enforcement.

It is highly doubtful at this point that Switzerland would be in any mood to further let go of its time-honored traditions that have served the nation well.

Perhaps this is a good time to remind the leadership of the European Union that it does not have jurisdiction over the whole world, not even over all of Europe. The last time I checked, the capital of Switzerland was not Brussels.