Working on the other side of the border: a bureaucratic maze
The Halloween Brexit didn’t take place. However, the lead-up to Brexit made it clear that it isn’t so easy to just cut off EU ties. Because when the UK leaves, it will have big consequences for the way its borders work. Now it is quite easy to travel and move to the UK, whereas Brexit will make this much harder. The free movement of workers is an important idea that the EU is built upon. Maastricht University researcher Bastiaan Didden, studied how the free movement of workers in The Netherlands, Belgium and Germany works in practice. He looked into how the EU borders affect pensions, social security and taxes when working across a border.
Didden, PhD candidate in tax law, has found out that there are quite some uncertainties when it comes to these subjects. This is because the EU-member states are in large part independent concerning their taxes, pensions and social security rules. With more than 1.4 million cross-border workers in the EU (in 2017), the pensions of a significant amount of EU citizens are at stake. Because it could be the case that the pension you are building up in Germany can’t be continued in Belgium when you start working there.
Patchwork of rules
According to Didden, there is no overall policy for these issues. So countries come up with their own solutions, which creates a patchwork of rules and regulations. This leads to a lot of extra administrative work and costs for employees. It makes it harder for citizens to work wherever they like. Didden says that countries should work more closely together on these issues and when they write new national policy, should incorporate the effects for cross-border employees. Just last month for example it was decided that Dutch employees living in Belgium don’t need to pay extra taxes in Belgium for their pension.
Unified in diversity
Didden says: “There should be more unity in diversity when it comes to cross border mobility. Just like the European motto: unified in diversity”. The EU stands for open borders hence also the pension accrual should benefit from this. Didden came up with fiscal advice for both European policy and national policy for improving cross-border pension accrual. Hopefully this will benefit people living close to a border.
Didden’s research is part of ITEM: Institute for Transnational and Euregional cross border cooperation and Mobility
Bastiaan Didden’s PhD defence is on November 8, 2019. More info.
PhD thesis written by Sander Paul Martijn Kramer
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