Germany's Merkel Demands Global Financial Transactions Tax

by Ulrika Lomas, Tax-News.com, Brussels

21 September 2009

During the recent EU summit meeting held in Brussels, Germany’s Chancellor Angela Merkel urged European leaders to support the idea of a global tax on financial transactions.

Determined to gain the backing of her European counterparts, the German Chancellor is eager to table the proposal at the forthcoming G20 summit meeting in the US.

Nevertheless, opinion within the EU remains very much divided. While Germany, France and Austria have expressed their support for an international financial transactions tax, the UK and Sweden remain rather more cautious.

Austria’s Chancellor Werner Faymann is one such advocate of the tax, firm in the belief that the EU should not wait for US approval before pressing ahead.

France’s Foreign Affairs Minister Bernard Kouchner has also recently spoken out in favor of the tax, confident that the adoption of a “solidarity contribution” would help to fund much needed development projects.

Indeed, according to Kouchner, applied on a global scale, the introduction of a 0.005% tax levied on all types of financial transactions could generate between EUR20bn and EUR30bn.

It has also emerged recently that the Kouchner has received backing from the President of the European Commission, José Manuel Barroso.

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