Saturday, 8 October 2016

EU financial transactions tax group to meet on Monday, no decision expected

In World Economy News 07/10/2016

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A group of 10 European Union countries that support a common financial transactions tax (FTT) will meet on Monday to discuss the issue but no breakthrough is expected yet, two EU officials said on Friday.
The introduction of a single tax on financial transactions across the EU countries that adopt it has been debated by EU finance ministers for more than five years but countries remain divided on how to apply the levy.
The group has repeatedly set deadlines that have not been met. After having pushed back the latest target of reaching a deal in September, the meeting in October was seen as important in view of a possible compromise by the end of the year.
The meeting on Monday will take place in Luxembourg on the sidelines of a monthly gathering of the 19 euro zone finance ministers.
“It will be a rather short meeting. I don’t expect any outcome from this debate,” an EU official involved in the talks said on Friday. A second official said the meeting will assess technical work carried out by two expert groups set up in June, but is not meant to reach decisions.
The countries that support an FTT are Germany, France, Italy, Austria, Belgium, Greece, Portugal, Slovakia, Slovenia and Spain.
A minimum of nine countries is required for the plan to go ahead under EU rules allowing a group of members to push forward common projects without the support of all 28 EU states.
On Tuesday, finance ministers from all EU member states will meet in Luxembourg but will not discuss the FTT, as no significant progress is expected at Monday’s meeting.
Talks on the issue are usually widened from the restricted group of 10 to 28 to address the impact of the possible tax on countries that would not apply it.
Several EU countries already apply national financial transaction taxes. However, a common tax is seen as more efficient and would reduce tax competition among the countries applying it.
The Slovak presidency of the EU is considering whether to add the issue to the agenda of the next EU finance ministers’ meeting in November, the official said.

Source: Reuters (Reporting by Francesco Guarascio; Editing by Susan Fenton)