American Banking in the Channel Islands and the United Kingdom in the 1970’s – Membership in the EEC and the Finance Act 1972

In 1967 the European Economic Community adopted indirect tax harmonization directives (the Value Added Tax), under the explicit authorization of Article 99 of the Treaty of Rome. No explicit provision authorizes the adoption of a harmonized direct taxation system.
The Treaty of Rome, under Article 100, implicitly authorizes harmonization of national provisions concerning direct taxation of corporations
and, to an extent, of shareholders. Article 100 authorizes the harmonization of any provisions that might affect the equal conditions of competition, and the functioning of the Common Market. The type of corporate tax system which is to be approved by the Community is open to speculation. The proposal is to be made in the near future in accordance with a 1971 decision of the Council. It is to include withholding taxes as they are related to the corporate tax systems. A harmonized corporate tax structure is to emerge in the near future in the Community.