The Canadian Press - ONLINE EDITION

10 EU nations agree to tax financial transactions from 2016 onward, Britain remains opposed

  • Print

BRUSSELS - A group of ten European Union countries has agreed to introduce a financial transaction tax from 2016 onward, in an effort to curb speculation and claw back revenues after governments had to bail out banks.

The nations — including economic heavyweights Germany, France, Italy and Spain — will initially tax only the trading of shares and some derivatives, according to a joint statement published Tuesday on the sidelines of a meeting of the 28-nation bloc's finance ministers.

The levy's scope won't be as broad as supporters initially hoped, but the countries said they hope to reach agreement on a tax that would include trading in most financial products later on.

The EU estimates a broad levy could yield some 30 billion euros ($42 billion) in additional annual tax revenues.

Austrian Finance Minister Michael Spindelegger, who played a leading role in the tax negotiations, said the group will now work to overcome remaining practical hurdles to finalize the legislation by the end of this year.

European officials started pushing for the tax following the 2008-09 financial crisis when governments had to spend hundreds of billions of taxpayer money for bailouts to avoid a complete meltdown of the financial system. Still, they failed to muster the required unanimity for an EU-wide solution.

Britain, which is home to the bloc's biggest financial hub, the City of London, is strongly opposed to the plan, saying it's a populist measure that will harm the economy and undermine banks' global competitiveness.

"It's not a tax on bankers, it's a tax on job on investment, on people's pensions. That's why the United Kingdom does not want to be a part of it," U.K. treasury chief George Osborne said.

But German Finance Minister Wolfgang Schaeuble voiced optimism that a successful introduction of the tax will create pressure for the 17 EU countries currently not participating to join in later.

Slovenia previously pledged to introduce the tax as well, making it the 11th member of the group, but its finance minister didn't sign Tuesday's statement because his government resigned Monday.

Campaigners in favour of what is sometimes referred to as "Robin Hood Tax" said the EU nations' proposal wasn't ambitious enough. Charity Oxfam insisted the "compromise does not yet ... ensure that the financial sector is finally made to pay its fair share of tax."

Germany's Schaeuble acknowledged the scope of the current proposal wasn't as broad as hoped, but said it was better than an elusive pursuit of a perfect deal everybody would sign up to in a distant future.

"The least ideal solution is that we're all in favour (of a tax) but we don't get it done," he said.

Britain's Osborne, meanwhile, denounced the lack of detail of the current tax proposal and threatened Britain would challenge any financial transaction tax if it were to affect also EU economies not participating.

"If they seek to damage jobs and investment across the rest of Europe, then we are entitled to challenge that," he insisted.

The EU's top court last week dismissed a British challenge to the introduction of the tax as premature since the tax has yet to be established. Britain argued it is illegal under EU law since it would affect even countries who don't sign up to it.

___

Follow Juergen Baetz on Twitter at http://www.twitter.com/jbaetz

Fact Check

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories?
Please use the form below and let us know.

* Required
  • Please post the headline of the story or the title of the video with the error.

  • Please post exactly what was wrong with the story.

  • Please indicate your source for the correct information.

  • Yes

    No

  • This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.

  • Cancel

Having problems with the form?

Contact Us Directly
  • Print

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

Have Your Say

Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?

Have Your Say

Comments are open to Winnipeg Free Press Subscribers only. why?

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.

letters

Make text: Larger | Smaller

LATEST VIDEO

Winnipeg Cheapskate: Cheap summer weekends

View more like this

Photo Store Gallery

  • PHIL.HOSSACK@FREEPRESS.MB.CA Winnipeg Free Press 090528 STAND UP...(Weather) One to oversee the pecking order, a pack of pelican's fishes the eddies under the Red River control structure at Lockport Thursday morning......
  • Geese take cover in long grass in the Tuxedo Business Park near Route 90 Wednesday- Day 28– June 27, 2012   (JOE BRYKSA / WINNIPEG FREE PRESS)

View More Gallery Photos

Poll

Should confessions extracted through Mr. Big police stings be admissible in court?

View Results

View Related Story

Ads by Google