Despite the introduction of a single market and economic and monetary union, there is still no genuine EU policy on taxation. Specific provisions are laid down in Articles 110 to 113 of the Treaty on the Functioning of the EU, but the decision-making procedure for taxation requires a unanimous vote in the Council. Up to now this has acted as a brake on the adoption of common rules for direct and indirect taxation. In order to avoid these obstacles, the Commission encourages the use of the "closer cooperation" procedure introduced by the Treaty of Amsterdam and developed by the Treaty of Nice.
Border controls on VAT were abolished with the introduction of the single market in 1993. Products are taxed in the country of destination. Furthermore, VAT and excise rates have been brought into closer alignment in the different Member States.