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Semeta Calls For Progress On FTT Project

by Ulrika Lomas, Tax-News.com, Brussels

07 February 2014


The European Commission's planned Financial Transaction Tax (FTT) is "a highly popular initiative, which Europeans believe in," Algirdas Šemeta has claimed.

Addressing a parliamentary plenary debate, the Tax Commissioner called on leaders to "keep this in mind when considering the proposal." This is all the more important when the "avalanche of lobby-driven criticisms" are taken into account, he noted.

Šemeta accused "strong vested-interest groups" of working "tirelessly to impede progress, over-estimating the threats and negative impact of this tax." He believes that this has created "apprehension" among European Union (EU) member states, but was adamant that "many of the fears are unfounded."

Member states must now redouble their efforts to find a compromise, Šemeta stressed. A number of options remain on the table that would reduce the scope of any future FTT, protecting "those transactions which are closely linked to the real economy or whose objective is to ensure market liquidity." These include intra-group transactions and certain transactions within a network of de-centralized banks. Lower rates could be implemented for products such as government bonds.

Šemeta's frustration at the lack of progress was clear. He argued that these options "should have been explored with greater zeal," urging "all FTT supporters to stand up and team up for progress."

In seeking the much-desired compromise, the Commission is prepared to accept the gradual implementation of an FTT, "if that is what the member states are more comfortable with today, for as long as this first step is clearly enshrined in an agreed path towards the eventual implementation of a broad base FTT."

TAGS: compliance | tax | European Commission | tax compliance | tax incentives | tobin tax | tax rates | tax reform | European Union (EU) | Europe

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