EU greenlights 'milestone' finance tax launch by 11 states

22nd January 2013, Comments 0 comments

Eleven European Union nations won a go-ahead from their partners on Tuesday to launch a controversial financial transactions tax, the EU executive said.

EU finance ministers gave their approval to the 11 to go ahead with the "milestone" levy under what is known as "enhanced cooperation", a rare procedure enabling a minimum of nine EU nations to work together without the remainder of the 27 EU states being involved.

"It is a milestone for EU tax policy, as it paves the way for more ambitious member states to progress on a tax file, even when unanimity could not be achieved," said the EU's tax commissioner Algirdas Semeta.

"Those who want to move ahead, and who appreciate the merits of working more closely on taxation at EU level, can do so," he added.

The enhanced cooperation procedure was first used in the field of divorce law and was last year approved a second time in the field of patents. This will be its third use.

Britain notably was opposed but did not stand in the way of the creation of an FTT, initially proposed by France and Germany, then joined by Austria, Belgium, Greece, Portugal and Slovenia, and later by Italy, Spain, Slovakia and Estonia.

The 11 eurozone states will now need the European Commission to draft legislation enacting a tax.

The tax is aimed at curbing the market excesses that led to the 2008 global financial crisis but the idea failed to win support from all 27 EU states, in part due to British concerns over the City of London's future.

Junior French Finance Minister Benoit Hamon welcomed Tuesday's apporval as "an important step" in "beginning to design a world post Lehman-brothers".

In Berlin, German Finance Minister Wolfgang Schauble saud "the financial sector muat be associated in a reasonable way to the costs of the financial crisis."

Tuesday's green light was "a good step towards that aim," he added.

© 2013 AFP

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