Saturday

19th Oct 2019

Ministers near deal on 'step-by-step' transactions tax

  • Schaueble - transactions tax can be implemented 'step-by-step' from 2016 (Photo: consilium.europa.eu)

Ministers anxious to bring in a tax on financial transactions are hoping to secure a political deal introducing a levy in 2016, in talks planned on Tuesday (6 May).

A document outlining plans for the tax's gradual introduction in 2016 is expected to be presented to the rest of the EU's 28 finance ministers later today, Reuters reports.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

“We know that we can only proceed step by step,” German Finance Minister Wolfgang Schaeuble said in Brussels on Monday. “The possibilities, the situations and the interests of the individual participating states are so different that only a limited taxation of shares and some derivatives is possible in a first step.”

"I want a political commitment that we jointly want this financial transaction tax and which timeframe we envision for it," said Austria's Michael Spindelegger. "Whether we will achieve that, we'll see."

Other EU countries, with the UK being the most vocal critic of the tax plan, have complained that the so-called "residence" and "issuance" principle in the proposed bill means that traders operating outside the FTT-11 would still be liable to pay the levy.

The UK, which has the largest financial services sector in the EU, says that it could be hit by the tax to the tune of £5 billion per year (€6 billion) as a result.

The proposal currently on the table includes a 0.1 percent levy on bonds and shares and 0.01 percent on derivative products.

France and Germany, together with nine other eurozone countries, have led support for the tax, often called the 'Robin Hood tax' by supporters, and want to have a political agreement for its introduction before the European elections later this month.

Talks between EU politicians on the possible merits and structure of a transactions tax have been a regular feature during the 2009-14 legislative term. The FTT-11 agreed to proceed with a tax using the EU's "enhanced co-operation" procedure in February 2013 after it became clear that a pan-EU regime would be vetoed by several countries.

Although supporters of a transactions tax see it as a way to make the financial sector pay towards the costs caused by the 2008-9 financial crisis and to curb speculation, in reality, the tax is more about political symbolism.

The tax rates proposed are too low to curb market behaviour, while the €30-35 billion in revenue which the European Commission estimates would be raised each year across the 11 countries involved, would be much lower than campaigners had hoped for.

Ministers from the eleven countries which support plans to establish the tax met in Brussels on Monday following a gathering of the 18 finance ministers of countries in the eurozone.

As expected, Portugal announced that it would not be requesting a temporary credit line or any further financial help when its three year €78 billion bailout programme concludes this month.

Juncker: 'Historic mistake' against Balkan EU hopefuls

The president of the European Commission Jean-Claude Juncker described a decision to block Albania and North Macedonia from advancing into the next phase to eventually join the European Union as a historic mistake.

News in Brief

  1. Macron: Nato's inability to react to Turkey a 'mistake'
  2. EU: US can expect counter measures after tariff move
  3. Almost 7,500 people forcibly returned to Libya in 2019
  4. Puigdemont released after responding to arrest warrant
  5. Commission: Facebook's Libra needs international approach
  6. Italian PM: denial of accession talks a 'historic mistake'
  7. Catalan president blames clashes on 'infiltrators'
  8. US imposes €6.7bn new tariffs on European products

EU parliament quietly hoards visitors' wi-fi data

The European Parliament is retaining the data of everyone who uses their wi-fi network, including journalists and visitors, and providing access to national authorities in case of investigations.

Stakeholders' Highlights

  1. Nordic Council of MinistersBrussels welcomes Nordic culture
  2. UNESDAUNESDA appoints Nicholas Hodac as Director General
  3. UNESDASoft drinks industry co-signs Circular Plastics Alliance Declaration
  4. FEANIEngineers Europe Advisory Group: Building the engineers of the future
  5. Nordic Council of MinistersNew programme studies infectious diseases and antibiotic resistance
  6. UNESDAUNESDA reduces added sugars 11.9% between 2015-2017
  7. International Partnership for Human RightsEU-Uzbekistan Human Rights Dialogue: EU to raise key fundamental rights issues
  8. Nordic Council of MinistersNo evidence that social media are harmful to young people
  9. Nordic Council of MinistersCanada to host the joint Nordic cultural initiative 2021
  10. Vote for the EU Sutainable Energy AwardsCast your vote for your favourite EUSEW Award finalist. You choose the winner of 2019 Citizen’s Award.
  11. Nordic Council of MinistersEducation gets refugees into work
  12. Counter BalanceSign the petition to help reform the EU’s Bank

Join EUobserver

Support quality EU news

Join us