Speaking prior to yesterday's Ecofin meeting of EU Finance Ministers, the Federation warned that due to the likely complexity of any solution reached, member states would need time to translate the directive into national law and implement the necessary legislation.

Meanwhile, all eyes were on the UK and Luxembourg at yesterday's meeting. The two countries effectively hold the future of the Savings Tax Directive in their hands, as UK Chancellor Gordon Brown has traditionally insisted that the information exchange process introduced must be automatic rather than voluntary (as proposed by the Swiss government), and Luxembourg's Prime Minister, Jean-Claude Juncker recently threatened to veto the whole process.

However, speaking to the AFX news service, an unnamed British source observed that the issue is for the meeting as a whole to decide upon, not just the United Kingdom.

Luxembourg's PM and Finance Minister, meanwhile hinted at the meeting that he might be prepared to compromise, according to reports.

Speaking at the beginning of the Ecofin meeting, Mr Juncker stated that: 'We are in favour of the adequate taxation of savings, but others must be prepared to move.'

However, he did not specify which 'other' countries were being referred to.