A group of 11 European countries, including Germany and France, will progress the Financial Transaction Tax (FTT), having been given the go ahead by European finance ministers today. Ireland and the UK are amongst the 16 countries that do not support the tax, but the other states will be allowed to implement a FTT on the grounds of “enhanced co-operation”.
Speaking in Brussels after a meeting of European finance ministers (ECOFIN), Algirdas Šemeta, the Commissioner responsible for Taxation and Customs Union, Audit and Anti-fraud, described the agreement as a “milestone” for EU tax policy, because “it paves the way for more ambitious Member States to progress on a tax file, even when unanimity could not be achieved”.
“Those who want to move ahead, and who appreciate the merits of working more closely on taxation at EU-level, can do so,” he said, adding that it was a “highly significant and very welcome advance”.
The vote in favour clears the way for Germany, France, Italy, Spain, Austria, Portugal, Belgium, Estonia, Greece, Slovakia and Slovenia to press ahead with their own tax on trading.
Mr Šemeta urged any Member State that is considering the FTT to “climb on board”, because “there is everything to gain from being part of an EU approach to the financial transactions tax”.
Pointing to “considerable new revenues” the tax will generate, Mr Šemeta said that this could be used for growth-friendly investment, and to support wider policy commitments such as development. Some believe that the tax could raise up to €20 billion a year, although estimates vary widely.
“Taxation will become fairer, as the financial sector makes a proper contribution to public finances and the costs of the crisis,” he said.
It is expected that the tax will be charged at a rate of 0.1 per cent of the value of any trade in shares or bonds, and 0.01 per cent of any financial derivative contract.
