The EU Parliament endorses tax on financial transactions

Algirdas Šemeta, Member of the European Commission in charge of Taxation, Customs, Statistics, Audit and Anti-Fraud, gave a press conference to present the details of the Financial Transaction Tax (FTT), which will be implemented under enhanced cooperation. As requested by the 11 Member States that will proceed with this tax, the proposed Directive mirrors the scope and objectives of the original FTT proposal put forward by the Commission in September 2011. (EC Audiovisual Services).

Algirdas Šemeta, Member of the European Commission in charge of Taxation, Customs, Statistics, Audit and Anti-Fraud, gave a press conference to present the details of the Financial Transaction Tax (FTT), which will be implemented under enhanced cooperation. As requested by the 11 Member States that will proceed with this tax, the proposed Directive mirrors the scope and objectives of the original FTT proposal put forward by the Commission in September 2011. (EC Audiovisual Services).

The European Parliament yesterday gave its final go ahead for the introduction of the Financial Transaction Tax (FTT) to be applied in the 11 Eurozone member states, which had initially accepted this Commission proposal. The European Parliament has a consultative role on tax matters. Consequently now it’s up to the 11 participating countries in this enhanced cooperation arrangement to reach a final deal. The 11 participating member states are: Austria, Belgium, Estonia, France, Germany, Italy, Greece, Portugal, Slovakia, Slovenia and Spain. Any other member state may join the enhanced cooperation, if they wish so.

Only 11 EU member states agreed

At this point it must be noted that last summer it became clear that there was insufficient support for the introduction of a financial transaction tax throughout the EU as proposed by the EU’s executive arm. Since then, eleven member states have requested from the Commission to present a proposal for enhanced cooperation on a FTT, specifying its scope and objective along the lines of the Commission’s original proposal. Enhanced cooperation can be launched at the request of at least nine member states.

On 22 January 2013, the Ecofin Council adopted a decision authorising the above mentioned eleven member states to go ahead with the enhanced cooperation on the introduction of the FTT. By that time the European Parliament had already authorised the introduction of this new levy. Yesterday the Parliament’s plenary gave its final green light accepting the text of a relevant resolution with 522 votes to 141, with 42 abstentions. The legislators introduced some minor changes enhancing the scope of the FTT.

Enhanced scope

The adopted text introduces provisions to make evading the FTT potentially far more expensive than paying it. The text links the payment of the FTT to the acquisition of legal ownership rights. This means that if the buyer of a security did not pay the FTT, there would be no legal certainty of owning that security and the trade could not be cleared centrally.

In any case the Parliament yesterday kept up the pressure for this comprehensive financial transaction tax in those 11 EU countries. The legislators agreed to a wide scope of the new tax and accepted rates of 0.1% for trades in stocks and bonds and 0.01% for those in derivatives. Lower rates should apply until 1 January 2017 for trades in sovereign bonds and pension fund industry trades.

In this respect the Parliament’s resolution provides that trades in sovereign bonds should be only taxed at 0.05% until 1 January 2017 and, up until the same day, trades of pension funds would be taxed at 0.05% for stocks and bonds and 0.005% for derivatives. It adds that when evaluating the FTT’s performance, the European Commission should pay special attention to the rate of taxation applied to pension funds.

In the case of derivatives though it is rather difficult to apply this tax because those financial products are not traded on official markets like stock exchanges. For example the Credit Default Swaps and credit derivatives are sold over the counter without the intervention of a structured market or an official clearing house.

According to the Press release issued by the Parliament, Anni Podimata (S&D, EL), Parliament’s lead MEP on the matter, welcomed the house’s tenacity. “Parliament has stayed true. We have taken a consistent line. We strongly believe that such a tax is the way the sector can contribute to emerging from the crisis and returns to its proper job of serving the real economy”, she said.

the sting Milestone

Featured Stings

Stopping antimicrobial resistance would cost just USD 2 per person a year

Can we feed everyone without unleashing disaster? Read on

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Nicaragua ‘crisis’ still cause for concern amid murder, torture allegations: Bachelet

Is ECB helping Germany to buy cheaply the rest of Europe?

COVID-19: Stopping the rise in domestic violence during lockdown

Shanghai has tough new recycling rules – and it will stop collecting trash from communities that don’t comply

Hollande protects the euro from the attacks of extremists

Human rights and COVID-19: MEPs denounce measures taken by authoritarian regimes

JADE Spring Meeting 2015- Europe’s Junior Entrepreneurs together for 4 days of networking, workshops and forward thinking

“Beyond the beach: tackling plastic pollution upstream”, a Sting Exclusive by Erik Solheim, Head of UN Environment

Antitrust: Commission publishes study on the application of Interchange Fees Regulation

Monday’s Daily Brief: human rights in the Near East and a Forum for Refugees

The fat from your next takeaway meal could help clean up global shipping

RescEU: MEPs vote to upgrade EU civil protection capacity

‘Harmonized’ plan launched to support millions of Venezuelan refugees and migrants

Peacekeeping: A ‘great opportunity’ to develop professionally and personally

Syria: Civilians bear brunt of unilateral sanctions, exacerbating ‘unparalleled suffering, destruction,’ says UN expert

New research reveals the true extent of corruption in fisheries

Three ways batteries could power change in the world

Marriage equality boosted employment of both partners in US gay and lesbian couples

Syria: UN chief warns Idlib offensive may set off ‘humanitarian catastrophe’

For how long and at what cost can the ECB continue printing trillions to keep euro area going?

UN launches Facebook Messenger-powered bot to take on climate change

State aid: Commission approves €53 million public support scheme for charging stations for low emission vehicles in Romania

Pakistan has just planted over a billion trees

What the COVID-19 pandemic teaches us about cybersecurity – and how to prepare for the inevitable global cyberattack

How can we overcome the racial barriers to global health parity?

Polio eradication a UN priority, says Guterres in Pakistan visit

Further reforms can foster more inclusive labour markets in The Netherlands

Deep science: what it is, and how it will shape our future

Mobile technology in medicine: a step to upgrade and the small steps forward

State of the Union 2017: Juncker’s optimism about EU growth and Brexit’s impact

38th ACP-EU Assembly: dialogue on cooperation challenges in Kigali

Can the banking union help Eurozone counter its imminent threats?

Medical Education is #NotATarget

When it comes to envirotech adoption, NGOs can lead us out of the woods

This tool shows you which cities will flood as ice sheets melt

The West and Russia took what they wanted from Ukraine

JADE Spring Meeting 2017– day 1: Excellence awards, panel discussion, keynote speeches

Germany is turning its old mines into tourist hotspots

Eliminating waste at scale – eight opportunities for blockchain

How the US should react to the pandemic, according to Bill Gates

Brexit: European Commission recommends the European Council (Article 50) to endorse the agreement reached on the revised Protocol on Ireland / Northern Ireland and revised Political Declaration

This new way of understanding disease is changing medicine

UN’s Bachelet rejects Sri Lankan official’s ‘spin’ on Human Rights Council encounter, urges reforms

Obese people more likely to smoke, says new gene research: WHO

Mental health in midst of a pandemic: can we help?

Belgium eases lockdown with free train tickets for every citizen

11 innovations protecting life below water – and above it

Trump in London poisons UK and Europe

Mountains matter, especially if you’re young, UN declares

The US calls off globalization, targets Germany. Paris offer to Berlin comes at a cost

Peace in the Gulf ‘at a critical juncture’ says DiCarlo, urging continuation of Iran nuclear deal

Greece: The new government of Alexis Tsipras shows its colors

Germany objects to EU Commission’s plan for a Eurozone bank deposits insurance scheme but Berlin could go along

EU Parliament shows its teeth in view of 2014 elections

Guterres censures terrorist attacks in Nigeria, pledges UN ‘solidarity’

Q&A on the 19th China-EU Summit to be held on 01-02 June 2017 in Brussels

Turkey’s Erdogan provokes the US and the EU by serving jihadists and trading on refugees

This chart shows how the energy mix is failing in the fight against climate change

Trump’s pounding of Iran less harsh than expected, leaves arrangement open

More Stings?

Advertising

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s