The transaction tax revenues, according to the SPD’s chief budget expert, would cover the funding gap for a common resolution fund, while its long-term source of finance – a user charge on individual banks – reaches its target level. Brussels proposed it gradually raises €55 billion over the course of a decade.
Until now Germany has opposed the creation of any common fund unless the EU treaty is amended, arguing that a first stage must leave bank resolution subject to the control of national banking authorities, to protect the interests of taxpayers. “We say that whoever wants a common resolution fund must agree to a financial transaction tax", Carsten Schneider, SPD budget spokesman in the German parliament, told the Financial Times.
Mr Schneider said that Wolfgang Schäuble, German finance minister, would have to drop his resistance to setting up a common fund as an essential part of the planned eurozone Banking Union. “We have a clear position that it must be a European resolution fund", he said. “It is clear that Wolfgang Schäuble will have to retreat from his present position. He is completely isolated. He is only supported by the eurosceptics in Great Britain.”
As a rule, the SPD is adamant that banks, their shareholders and creditors must pay the costs of any bank failure, and not ordinary taxpayers. Until sufficient finance is available directly from banks, Mr Schneider said, the FTT should make up the difference.
Another important divergence with Ms Merkel’s Christian Democratic Union is the SPD’s opposition to any direct recapitalisation of banks from the European Stability Mechanism, the eurozone’s €500 billion bailout fund.
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