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Simon Lewis, chief executive, the Association for Financial Markets in Europe (AFME), said: “We welcome the decision to make a legal challenge to the proposed financial transaction tax amongst 11 EU Member States, under enhanced cooperation. All the evidence shows that the tax will have serious harmful economic effects in a number of ways: taxing securities will increase the cost of raising capital for Europe’s businesses and increase the cost of debt funding for both businesses and governments. In addition, taxing derivatives will have a negative impact on hedging transactions undertaken by the real economy in order to manage risk."