I got this image in an e-mail from Dries' blog, a basic flowchart for understanding VAT in Europe: http://www.buytaert.net/images/blog/vat-in-europe.jpg
He has a disclaimer, but it seems to be a good visual understanding of what must be possible for Ubercart to be a viable e-commerce solution in Europe. The two things we don't easily facilitate at the moment, by my reckoning, are allowing customers to enter their own VAT number (do we need to do a checksum on these to validate them?) and making it easy to apply taxes only to EU member states.
I believe zmove's VAT contrib can handle accepting a customer's VAT through a checkout pane, though I haven't tested it myself. Perhaps we should focus our efforts on making this module solid for that use and then building into it a workflow-ng condition that will check an order to see if the customer is in an EU member state with a single condition. Right now you'd have to have the countries enabled and add individual conditions to the tax configuration for each country... a single condition could make this super simple. Since we're using ISO-3166-1 number for country IDs, it won't be a problem to build this into a single condition check. (in_array() anyone? )
Once this is polished up, I think we also need to address the product price display concerns. I'm sure there are a range of things countries require, but we can work towards total flexibility.
As soon as this action happens, or even during, I propose opening a project on drupal.org for the VAT module that we can direct people to. I'm happy to open this for us and provide CVS access to anyone interested in contributing. We simply can't ignore such an important task, and at the moment core just doesn't cut it.
Please respond if I'm missing anything or if you have other feedback. Perhaps the module should be a more general International Tax module to accommodate the PST, GST, and whatever other taxes exist in places like Australia, Canada, etc.