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SPEECH - Financial Transaction Tax through Enhanced Cooperation

European Commission - SPEECH/13/124   14/02/2013

Other available languages: none

European Commission

Algirdas Šemeta

Commissioner responsible for Taxation and Customs Union, Audit and Anti-fraud

Financial Transaction Tax through Enhanced Cooperation

Press statement / Brussels

14 February 2013

Ladies and Gentlemen,

It is a great pleasure to be able to present today's proposal to you.

It sets out the details of the Financial Transaction Tax to be applied by 11 Member States through enhanced cooperation.

And, in doing so, it lays the final paving stone on the road towards a common FTT in the EU - the first Financial Transaction Tax ever to be implemented at regional level.

What we have proposed is an unquestionably fair, technically sound and legally robust tax.

A tax which will strengthen our Single Market and temper irresponsible financial trading.

A tax which will deliver an estimated 30-35 billion euros a year, when implemented by the 11 Member States in question.

As clearly requested by the 11 participating Member States, the Commission stuck closely to our original FTT blueprint when drawing up this proposal..

This means we kept the low rates of 0.1% for shares and bonds, and 0.01% for derivatives.

We maintained the wide base, covering all financial institutions and all financial instruments.

The real economy continues to be protected, as we ring-fenced ordinary financial activities of citizens and businesses, as well as activities linked to raising capital.

Transactions related to monetary policy, refinancing and public debt management are also outside the scope.

Finally, the solid safeguards against relocation of the financial sector from the participating States are not only preserved from the initial proposal – but reinforced.

In terms of changes in today's proposal compared to that which I presented in September 2011, there are just a few.

And each of these changes has been introduced for a valid and rational reason:

Either they give more legal certainty to the text, for example, by clarifying the definition of a financial institution and explicitly excluding the ECB, EFSF and ESM from the scope.

Or they reinforce anti-avoidance measures, for example, by complementing the "residence principle" we had already envisaged in the last proposal with the "issuance principle".

Overall , this would mean that any transactions would be taxed as long as there is an established economic link to the FTT-zone, be it through parties to the transaction, or if the traded product was issued there.

Such provisions provide strong protection against relocation or avoidance for the Member States applying the FTT.

It also preserves the non-participating Member States from any adverse impact on their rights and obligations under the treaty.

Ladies and Gentlemen,

Eleven Member States called for this proposal I have presented today, so that they can move ahead with the FTT through enhanced cooperation.

I now call on them to continue to push ahead with ambition. This would respond to the long-time demands of our citizens, who have long understood the benefits that a harmonised approach on the FTT can bring.

Every procedural step to facilitate an FTT through enhanced cooperation has been met now, and nothing stands in the way of its implementation.

I now hand over to the 11 Member States to drive, decide and deliver on this harmonised Financial Transaction Tax.


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