Celebrating progress on an EU FTT
Big win for Robin Hood Tax in Europe
Earlier this week, Finance Ministers from 10 Eurozone countries finally reached agreement on the principle of a Robin Hood Tax. Legislative drafting will now begin, and campaigners will be pressing the Ministers to conclude the details by December. Meanwhile, US Democrats scenting victory in next month’s Presidential election as Trump’s campaign crumbles, are redoubling the battle for a financial transactions tax (FTT) over the Atlantic. And the Eurozone FTT could even apply to trading in the City, as it develops – and outside the EU, City lobbyists will have little sway over its extension.
So it’s a good week for the Robin Hood Tax.
German Finance Minister Wolfgang Schaeuble told reporters after the meeting that:
“The countries that had reservations last time have withdrawn them, so some countries now want to take a look at the possible consequences of the text. We want to have a decision by year-end, a positive one, if possible.”
And French Commissioner Pierre Moscovici, whose officials will be drafting the legislation, said:
“We are designing something which is ambitious and realistic. Hopefully in the weeks to come we will be capable of submitting drafts … and adopt what could be the first European FTT.”
Meanwhile in the USA, the Americans for Financial Reform are keeping up the pressure for Democrats to tackle Wall Street, although Presidential candidate Hillary Clinton is proposing a tax only on high frequency trading – the worst aspect of stock market gambling. A triple Democrat win in both houses of Congress as well as the White House – unthinkable until Trump’s campaign began to implode but now not impossible – would increase the pressure to recreate the sort of financial transactions tax on the US futures market that lasted from 1917 to 1938 until the middle-men traders who were actually paying the tax lobbied successfully for the costs to be transferred to investors.
Wolfgang Shaeuble has already suggested that the next step after the Eurozone FTT would be a global tax (he was originally misinterpreted as suggesting that as an alternative) and as Germany takes over the G20 at the end of this year, he may soon have a platform for just that.