Commissioner Šemeta outlined the EC objectives for the financial transaction tax. The EC must ensure that the initiatives currently being debated would not result in the relocation of financial transactions to other regions, thereby affecting EU competitiveness.
Commissioner Šemeta (TAXUD) outlined the EC objectives for the financial transaction tax (FTT)
The EU will follow the G20 recommendations. However, the EC has to ensure that the initiatives currently being debated would not result in the relocation of financial transactions to other regions, thereby deeply affecting EU competitiveness. The EC wants a global - not just a European - FTT,.. It is still too early to discuss the allocation of the tax revenue; however, it would have to be asymmetric and just located in the countries where there are big financial centres. The same should apply for the revenue expenditure.
Jean-Paul Gauzès (EPP/FR) is generally in favour on the FTT; however, he pointed out that the EC has to ensure that it does not harm Europe’s financial industry.
Pascal Canfin (Greens/FR) stressed that the less harmful solution to increase member state revenue to face the crisis would be to implement the FTT.
Kay Swinburne (ECR/UK) warned that there is no sense in providing an EU proposal to a global problem. She also highlighted that a tax at European level is not more efficient than a tax at member state level; therefore taxes raised to stabilized financial sectors should not be tackled at EU level.
Gunnar Hökmark (EPP/SE) questioned the EU’s administrative capacity to manage the FTT. In theory it could work but there is a need to define how it will work, and where the revenue will be expended.
Pervenche Berès (S&D/FR) urged the Commissioner to come forward with specific proposals. She would like the EU to act now and not to wait for the rest of the G20 members to react on that specific issue.
Vicky Ford (ECR/UK) made three points to be considered by the EC:
1) The impact of the FTT on end users as there is a risk of harming them.
2) Impact on EU competitiveness
3) The FTT could create moral hazard. The possible creation of a fund founded with the FTT will encourage bankers to take risk.
Catherine Stihler (S&D/UK) talked about the Robin Hood tax which is NGOs’ initiative to tax the 0.05 per cent of the global financial transactions. The Robin Hood campaign is not about taxing the people who withdraw cash; it is about taxing big bank transactions. She encouraged Commissioner Šemeta to carefully look at that campaign.
Commissioner Šemeta concluded by saying that the EC is not only looking at a possible FTT, but also a bank levy.
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