Page last updated at 18:56 GMT, Tuesday, 11 December 2012

Green light given to EU financial transaction tax

MEPs have urged a group of EU countries to go ahead with implementing a financial transaction tax (FTT).

The European Parliament is being asked to approve the so-called "enhanced co-operation" procedure, by which groups of member states may harmonise their policies on a certain issue without waiting for all EU members to join up.

Speaking during the debate on 11 December 2012, the parliament's negotiator on the Commission's FTT proposals, Greek socialist MEP Ani Podimata, said it would be a "message of solidarity and fairness", claiming that banks needed to pay more to deal with the situation in the eurozone.

Ten EU countries - including France and Germany - want to introduce a FTT to help raise funds to tackle the debt crisis.

Taxation Commissioner Algirdas Semeta said the Commission's proposals were about "fairness and efficiency", and that having a common FTT would avoid "cumbersome" national systems.

The EU failed to get agreement for a transactions tax from all 27 member states at a summit in June and the UK has been especially vocal in its opposition to the tax, which it feels would hit the City of London particularly hard.

Although most MEPs spoke in favour of the proposal, British Conservative MEP Ashley Fox said there was little benefit in a FTT that only applied to a few countries, instead of being a global tax.

"For the most part, it will displace companies to neighbouring countries that do not have a financial transaction tax", he added.

An FTT would involve a small charge on transactions of currencies, bonds and shares traded at banks and financial institutions, which the Commission estimates could raise €57bn a year if it were applied across the entire EU.

MEPs gave the green light to the ten EU countries to go ahead with their plans took place during the daily voting session on 12 December 2012.

Useful links:

Democracy Live's guide to how the plenary sessions work.

A disclaimer on the use of simultaneous interpretations, on the European Parliament's website.

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