Financial transactions tax to happen... one day: Belgian PM

2nd July 2010, Comments 0 comments

The idea of a global tax on financial transactions has failed to gain traction around the world but it will become a reality in Europe "one day or another," the Belgium EU presidency said Friday.

Belgian Prime Minister Yves Leterme, whose country holds the rotating European Union presidency for the next six months, said governments were still "far from" agreeing on a tax.

"On the other hand, I think that within the European Council (of EU leaders) we have nevertheless made enormous progress," Leterme said.

"It is an idea which I think will take shape one day or another," he said.

European Commission President Jose Manuel Barroso said leaders meeting at the G20 summit of developed and emerging powers in Toronto last weekend showed "no enthusiasm" for a global tax on financial transactions.

European leaders had agreed at their own summit last month that they would examine what steps to take if no agreement on global financial transaction tax was reached at the G20, Barroso said.

"It's what we're going to do," Barroso said.

European tax commissioner Algirdas Semeta will lead an analysis on the different options for Europe which could be concluded later this year, said his spokeswoman Emer Traynor.

"It does look like the possibility of a global agreement on a financial transaction tax is relativily slim. So on that basis, we need to explore this issue within Europe," Traynor said.

Britain is opposed to such a tax because it fears that financial institutions would move such transactions to other regions such as Asia. But German wants to press ahead with the idea.

In Berlin, German Finance Minister Wolfgang Schaeuble said he and French counterpart Christine Lagarde would ask the European Commission "in the coming days" to introduce a European regulation for a tax on financial transactions.

Imposing such a tax at the European level "won't be easy," Schaeuble told German lawmakers, adding that it might be possible to institute it within the 16-nation eurozone, which does not include Britain.

© 2010 AFP

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