Anni Podimata, the Greek member of the European Parliament who oversaw the institution’s text on the FTT, said she did not support exempting pension funds wholesale, but added: “I think we need to be quite cautious on specific instruments that are used by pension funds and examine the possibility of exempting some. Just one example could be repurchase agreements, which is a mechanism used very often by pension funds. This could be an option.”
Podimata, who is a member of the Progressive Alliance of Socialists & Democrats, said she would also explore giving on-exchange deals more favourable treatment.
The draft proposal published on February 14 covers a range of financial institutions and instruments. Repurchase agreements, a vital form of short-term funding which typically involve a dealer selling securities to an investor on the basis it will repurchase them later, are also included, although the entire transaction will be taxed once.
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