Eleven Eurozone countries are now willing to implement FTT
Eleven countries in the Eurozone have now said that they will implement a tax on financial transactions after being convinced by a concerted effort from France and Germany.
The news comes as a surprise to some member states, the UK included. Many diplomats thought that the introduction of a Eurozone-wide Financial Transaction Tax (FTT) was mere economic theory, but with eleven states now signed up this could well become a reality.
At a meeting in Luxemburg, finance ministers from Estonia, Italy, Slovakia, and Spain signed on to introduce the FTT. It is thought that this was due to pressure from Paris and Berlin.
The number of countries agreeing to the measures now exceeds the threshold of nine member states needed to move ahead with the legislation under “enhanced cooperation”.
Algirdas Semeta, EU Tax Commissioner, said, “Four additional member states intend to join enhanced cooperation, so it means that we arrive to 11 member states. When we will receive nine or more formal letters, only then the process will start.”
The tax faces fierce opposition from Eurozone members Ireland and the Netherlands. Dutch Finance Minister Jan Kees de Jager said that the Netherlands was even adverse to the tax being introduced “in other countries”.
Outside of the Eurozone, the news has been met with mixed reactions.
Sweden, which introduced the tax in the 1980 with disastrous results, is vehemently opposed to the tax. Swedish Finance Minister Anders Borg said that the move will “have a negative impact on growth”.
There are mixed feelings in the UK about a Eurozone FTT. George Lyon MEP summed it up whilst speaking exclusively to The Information Daily.
Whilst opposed to the tax on principle, Lyon said that the UK may benefit from the Eurozone decision as businesses may choose to avoid the tax in Europe by holding transactions in London, as happened when Sweden implemented the tax.
He said, “If Europe chose to go it alone, with the UK choosing not to join in, then I think they run the risk of the exact same thing happening.”