THE EUROPEAN COMMISSION has agreed to introduce the first step in bringing a financial transaction tax (FTT) to ten EU member states.
It has been estimated the tax could yield as much as €57 billion if introduced on a EU-wide basis – but concerns remain in Ireland that its introduction could undermine its competitiveness and see jobs transferred to the UK and other countries.
However, France, Spain, Germany, Italy, Greece, Portugal, Belgium, Austria, Slovakia and Slovenia have all supported the introduction of an FTT. The states are to introduce the tax using the little-used procedure of “enhanced cooperation”, which allows a minimum of nine members states to pioneer new legislation when the EU-27 failed to reach unanimity.
The concept of the tax was first put forward in the 1970s by US Nobel laureate James Tobin, who advocated taxes on transactions to curb market volatility.
Ireland’s Finance Minister Michael Noonan has ruled out Ireland introducing an FTT – saying that such a move would potentially see Ireland lose jobs to the UK, where the tax will not be introduced.
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