Eventually some cross-nation sense will need to arise, otherwise the three forces will cause such strains that the whole cat's cradle collapses.
The nations must have taxes but across Europe taxation is an unholy mess. This has also contributed to tensioning this cat's cradle of nations. The social forces pull against the political forces, and the external financial forces, as has recently been demonstrated is twanging the elastic bands of the PIGS [Portugal, Ireland, Greece and Spain] nations and also Britain.
The linked document published on 20 December 2010 on Cross Border Taxation (click here to view) by the EU outlines the mess.
This blog has elsewhere demonstrated the unfairness of the Double Taxation Treaty between France and the UK. The document surveys this as well as many other points.