European Robin Hood Tax clears another hurdle
UPDATE: Estonia joined as the 11th country a couple of days later after the proposal cleared a crucial Parliamentary hurdle.
Today the European Commission gave the green light to the adoption of a Financial Transactions Tax (FTT) by 10 European countries, bringing a Robin Hood Tax that could raise €37bn a year one step closer. The Commission’s decision means that the proposal is legal under EU law, and meets the criteria for a process known as the Enhanced Co-operation Procedure (ECP) where a subset of EU member states want to do something where unanimity cannot be achieved.
The Tax Commissioner, Algirdas Semeta, said:
“in difficult times, fairness matters. And the FTT is the epitome of a fair tax. It will also help to deter the casino-type trading we’ve seen too much of, and re-focus the financial sector more on supporting the real economy.”
The next step is for the Finance Ministers’ meeting (ECOFIN) on 13 November, to agree. It’s still possible that other countries could join in, and there is still scope to improve the measure originally proposed by the Commission in September 2011 (for example to prevent avoidance by adopting the same principle that underpins the UK’s stamp duty on shares).
There’s an excellent summary of what was decided today, and what the next steps are.
Alternatively, it is also still possible for a blocking minority to be mobilised to prevent the coalition of the willing proceeding – but so far governments like the UK seem willing to let the measure go through as long as they don’t have to join (there’s a curiously balanced approach to the issue even in the comments on this dead straight ConHome blog by Iain Anderson.)
The 10 countries which have already written to the Commission indicating that they want to proceed is Austria, Belgium, France, Germany, Greece, Italy, Portugal, Slovakia, Slovenia and Spain, including four of the five biggest economies in the EU: no prizes for guessing which one is the odd one out! Estonia, which had been expected to sign up, could well still do so, and unions and campaigners will be lobbying several other governments to join in.
Not surprisingly, the Robin Hood Tax campaign are delighted, and spokesperson Dave Hillman said:
“We are delighted that the European FTT is moving from rhetoric to reality and will ensure banks pay for the damage they have caused. This shows it is possible to put the needs of the public over the profits of a privileged few. It’s unforgivable in this age of austerity that the UK Government is turning down billions in additional revenue to protect the City’s elite.”