Key EU Parliament committee backs financial transaction tax

MEPs say the “pendulum has swung” in favour of controversial tax

The European Parliament’s key Economic and Monetary Affairs Committee has come out in favour of a financial transaction tax – at least in the Eurozone.
The committee had its first discussion on the tax, which was tabled by the European Commission late last year, at a meeting in Brussels yesterday. The Commission is seeking a 0.1% tax on equity and bond transactions and 0.01% on derivatives, which it claims would raise €55bn. The committee, which scrutinises economics matters for the Parliament, plans a draft report on the FTT at the end of February. It will vote on the issue in early April before the whole Parliament decides on the matter in a plenary vote in June.
“A very broad agreement in favour of an EU financial transaction tax emerged, on Monday, at the start of the Economic and Monetary Affairs Committee’s work on the legislative proposal,” the Parliament stated.
It said MEPs from the body’s various political groups all advocated the tax “at least throughout the Eurozone”.

Committee chairman Wolf Klinz, a German MEP in the Alliance of Liberals and Democrats for Europe (ALDE) group, said the financial sector has not learnt the lessons from the crisis.It comes as the political impetus behind an EU-wide tax is gaining in Europe, although a unilateral French trading tax mooted over the weekend has been met with criticism.

Support at the meeting yesterday came from the centre-right European People’s Party, the Greens, the Socialists and the European United Left/Nordic Green Left (GUE/NGL) groups. German MEP Jürgen Klute of the latter faction argued that the tax would not constitute “revenge” on the financial sector but make it share some of the burden of the crisis.

Only the right of centre European Conservatives and Reformists (ECR) group remained opposed to the FTT, the Parliament said. ECR spokesman Ivo Strejček, a Czech MEP, warned finance firms would relocate within weeks.
Marta Andreasen, the former EU Chief Accountant who is now a UK Independence Party MEP, was at the meeting. She said: “I find it incredible that at this point in time and with the very survival of the Euro still at stake, MEPs saw fit to discuss the FTT as the first item on the agenda after the Christmas break.” It was madness to be pushing on this issue, she added.