Second attempt at financial transaction tax

The European Commission today (14 February) made its second attempt to bring in a financial transaction tax. 

Officials said that the tax, which would be set up in the 11 European Union member states in support of the scheme, would bring in €30 billion-€35bn per year.  

As under its original plan, the Commission proposed to impose a tax of 0.1% on share and bond transactions and 0.01% on derivatives trades.  

The 2011 proposal was abandoned when several EU member states opposed the plan. Eleven countries requested to go ahead with the tax under the ‘enhanced co-operation' process, limited to a smaller group of countries.  

Algirdas Šemeta, the European commissioner for taxation, said that “everything is in place” for the tax to become a reality.  

“On the table is an unquestionably fair and technically sound tax, which will strengthen our single market and temper irresponsible trading,” he added.  

He said that the 11 countries who wished to implement the tax should “push ahead with ambition”.  

Finance ministers from those countries will now enter into negotiation on the shape of the legislation. Ministers from member states not taking part will participate in discussions but will not have a vote at the conclusion of the negotiations.  

The European Parliament cannot block the plans but will be consulted. Centre-left MEPs today welcomed the proposal.  

Hannes Swoboda, the Socialist and Democrat group president, said that the proposal was “one more step in the process of holding financial institutions to account for their role in the crisis and making them contribute to its costs”.