AFME: Financial transaction tax would hamper economic growth

17 August 2011

A European financial transaction tax would be a brake on economic growth, the Association for Financial Markets in Europe, which represents Europe's wholesale financial markets firms, said today.

Simon Lewis, AFME’s chief executive said: “The financial services industry should not be seen as an additional source of tax revenue but as an essential part of a stable and sustainable economy". “The real impact of a possible transaction tax needs to be understood. Many financial transactions are carried out on behalf of businesses that would bear the cost of the additional tax. For example, the foreign exchange market underpins international trade and a tax on these currency trades would increase costs for a large section of European industry, to the detriment of economic growth.”

The finance sector is already one of the largest contributors of tax revenue. Its input includes taxes on business profits, employment taxes on employers and employees, sector‐specific levies and value added taxes.

Press release

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