The ECON committee presented a resolution on financial transaction tax, which, was voted, and passed in the EP plenary session. The EC was asked to assess how this tax could help stabilize financial markets, by targeting "undesirable" transactions and preventing a similar crisis happening again.
What shape for a financial transaction tax?
Plans should be developed for a global tax to discourage excessive risk-taking by financial institutions and ensure that the financial industry pays for the damage caused by the financial crisis, says Parliament in a resolution approved on Wednesday. If a worldwide tax proves unachievable, the EU could consider the option of going it alone, add MEPs.
Parliament asks the Commission to develop the transaction tax plan in time for the EU to present a common position to present to the G20 in June. The Commission is also asked to assess how such a tax could help stabilise financial markets and prevent a similar crisis by targeting "undesirable" transactions, which should be specifically identified by the Commission, says the resolution.
The Commission and Council are urged to look at how the tax could be used to finance development co-operation and help developing countries to combat climate change, as well as at how the tax could contribute to the EU budget.
While preferring a global approach through the G20, MEPs believe that the pros and cons of introducing a purely EU-wide tax should be weighed up, even if the EU's main partners do not introduce such a tax.
Any such tax must not harm the banking system's ability to perform its vital role of financing real economy investments, and must not encourage the migration of capital, the resolution stresses. Negative repercussions on small businesses and individual investors must be avoided, it adds.
This resolution is not advocating one model or another, but aims to launch work on many questions that need answering, said Economic and Monetary Affairs Committee MEP Edward Scicluna (S&D, MT), in a debate with the European Commission on Monday, adding that "there are as many advocates for this tax as there are detractors", and impact assessments would be needed.
Replying for the Commission, Algirdas Semeta said it believed that the issue is best tackled at global level, since this is the only way to prevent capital flight. He also said that the Commission was considering regulating the financial industry by means of such a tax and that without a well-defined distributive mechanism, the revenue generated could well end up in those few countries with large financial centers.
The resolution on a financial transaction tax was approved with 536 votes in favour, 80 against and 33 abstentions
© European Parliament
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FTT motion for resolution.pdf
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