Financial Transaction Tax

Financial Transaction Tax

Introduction

On 28, September 2011 asked the European Commission President Jose Manuel Barros presented a bill to the EU Commission to introduce a financial transaction tax in the EU, so that the financial sector to make an acceptable contribution. The EU Commission stated in its reasoning suggests that the low taxed financial sector supported by the financial crisis, with 4600 billion Euros. The rate would be set according to internal calculations of the European Commission amounted to 0.1 percent on trading of stocks and bonds and 0.01 percent for derivatives of stocks and bonds. Foreign exchange transactions on the spot market as well as other derivatives should be exempt from the tax. In sum could be taking in around 50 billion Euros, the majority of which will benefit the member countries.

In spring 2012, nine EU countries started a new initiative to introduce a financial transaction tax at EU level, but failed, especially opposed by both non-euro countries, the UK and Sweden. The alternative of introducing the tax only in the euro zone failed to turn on resistance of Luxembourg and the Netherlands (Schmidt 1987).

In June 2012, the objective of an introduction to the entire euro area abandoned. The remaining EU countries agreed to a financial transaction tax now introduced only in the worsened countries. The basis for this found in the EU legal framework of a so-called enhanced cooperation between at least nine EU countries. It is. Participate In early October had with France, Germany, Austria, Belgium, Greece, Portugal and Slovenia, however, only seven countries have confirmed their participation and also introduced their relevant written application to the European Commission. On EU Finance Ministers in Luxembourg on 9 October 2012 should be - in order to achieve the minimum number of nine - in Italy and Spain retuned in order to participate in the financial transaction tax. Not only that goal was to end it reached Ministers, it joined also Estonia and Slovakia on, bringing the total of eleven EU countries will introduce the transaction tax. Worked out the details are up to Christmas 2012 be. Open to others are questions about what will actually be taxed like and what budget revenues should flow from the financial transaction tax: Whether the output stays in the federal budget or to be supplied to the common EU budget, with the latter also the question provides that the national payment obligations of the participating countries reduced compared to the EU budget by these amounts. According to the Austrian Finance Minister Fester this would also be an incentive system that still more countries participate in the transaction tax. Britain and Poland demanding contrast of the countries of enhanced cooperation that finished concepts to nonparticipating countries submitted for consideration at the EU impact - and even (as expressed by side in Poland) the package of all EU countries would have to be approved.

Discussion

History

One of the first considerations for a financial transaction tax in relation to the stock market goes to John Maynard Keynes ...