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The book is concerned with the main issues that arise forgeneral commodity taxation in the internal market: thechoice of a new international tax principle and the questionof tax rate harmonization.;The book provides a thoroughdiscussion of these issues and evaluates the choices made bythe European Community from a welfare-theoretic perspectiveby comparing them to feasible alternatives.;The discussion integrates a large number of recenttheoretical and policy-oriented contributions which have sofar not been collected and summarized in a single volume.;Special features of the book are that (a) the analysiscombines elements of international trade theory and publicfinance, two economic disciplines which are rarelyintegrated; (b) a dual general equilibrium framework is usedthroughout the analysis, (c) a second-best setting isconsistently employed, incorporating relevant policyconstraints and integrating conflicting arguments in asingle analytical framework, (d) part of the theoreticalanalysis is supplemented by a computable general equilibriumapproach.;The book shows that well-known international trademodelscan be extended to model alternative principles for taxinginternational trade but also international differences inpreferences for public goods and different views ofgovernment behavior - issues which are directly relevant forthe discussion of tax rateharmonization but are rarelytreated in an analytical way.