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German SPD Seeks EU Financial Tax

by Ulrika Lomas, Tax-News.com, Brussels

06 May 2010


Determined to ensure that taxpayers in Germany do not bear the huge burden of the financial crisis, the Social Democrats (SPD) are calling for the introduction of a European financial markets tax to be levied on all financial products – on the one hand to cover the costs of the aid package for Greece, and on the other to create a fund for future financial crises.

While conceding that it is indeed in Germany’s interest to maintain a stable euro, particularly given the country's position as a major trading force in the global economy, the SPD has expressed its outrage that the coalition government expects German taxpayers to foot the bill for costs arising from the malpractice of European banks and financial market actors, who knowingly issued further credit to a struggling Greece, while at the same time profiting from speculating against both the euro and against EU member states.

Bitterly criticizing the voluntary, one-off – and somewhat insignificant – contribution to the Greek crisis negotiated by the German government with the country’s banks, the SPD noted that this was completely inadequate and merely represented a token gesture.

Consequently the SPD has decided to negotiate the following demands in parliament, during emergency talks to approve the draft bill for Germany’s aid package for Greece:

  • The implementation of effective rules to regulate the European financial markets.
  • The introduction of a European financial markets tax imposed on all products.
  • The progressive creation of a European economic and financial policy, to ensure that the necessary framework conditions are established to guarantee the future stability of the common currency.

Determined to secure the EUR8.4bn aid package for Greece in a matter of days rather than months (as is usually required for parliamentary approval), the government faces clear opposition - and questioning - from many undecided politicians from all parties. Even Germany's Economics Minister Rainer Brüderle has made known that he has “stomach ache” because of the Greek aid package, which “no-one wanted”.

TAGS: tax | economics | fiscal policy | banking | Germany | Greece | currency

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