Brussels backs financial activities tax

The European Commission set out its ideas for the future taxation of the financial sector on the 7 October 2010. Working on the basis that the financial sector needs to make a fair contribution to public finances, and that governments urgently need new sources of revenue in the current economic climate, the Commission puts forward a two pronged approach.

At global level, the Commission supports the idea of a Financial Transactions Tax (FTT), which could help fund international challenges such as development or climate change. At EU level, the Commission recommends that a Financial Activities Tax (FAT) would be the preferable option.

If carefully designed and implemented, an EU FAT could generate significant revenues and help to ensure greater stability of financial markets, without posing undue risk to EU competitiveness. The Commission will present these ideas to the European Council at the end of October 2010 and to the G20 Summit in November 2010.

European Commission: Press Release: IP/10/1298: Commission outlines vision for taxing the financial sector http://europa.eu/rapid/pressReleasesAction.do?reference=IP/10/1298&format=PDF&aged=0&language=EN&guiLanguage=en

EUObserver, 7.10.10: Brussels puts forward financial sector tax options http://euobserver.com/9/30988

EurActiv, 7.7.10: Commission backs €25bn 'Financial Activities Tax' http://www.euractiv.com/euro-finance/commission-backs-25bn-financial-news-498586

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