European Economic Area (EEA)

The European Economic Area (EEA) came into being on 1 January 1, 1994 following an agreement between the European Free trade Association (EFTA) and the European Union (EU). It was designed to allow EFTA countries to participate in the European Single Market without having to join the EU. In a referendum, Switzerland (ever keen on neutrality) chose not to participate in the EEA (although it is linked to the European Union by bilateral agreements similar in content to the EEA agreement), so the current members are the EU states plus Norway, Iceland and Liechtenstein.

For you interest:
Switzerland signed the Schengen-agreement in June 2004 implying the Swiss are granted access to EU's Schengen passport-free zone. In exchange, the agreement allows EU's 25 member states to get hold of untaxed cash deposited abroad either by sharing bank details on tax evaders or by deducting a 35% withholding tax on the savings of non-residents in return for allowing the countries concerned to maintain banking secrecy.

Similar financial terms

European Central Bank (ECB)
The Central Bank for the new European Monetary Union.

European Union (EU)
The European Union (EU) is a union of twenty-five independent states based on the European Communities and founded to enhance political, economic and social co-operation. The union was formerly known as the European Community (EC) and European Economic Community (EEC).

The common currency in the EU is the euro (EUR. Still, some countries have chosen to stay outside the European Monetary Union.

At the moment, the 25 member states are:
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Taxable income

Gross income less a set of deductions such as allowances, deeds of covenants, and losses.


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