France Brings Back Financial Transaction Tax Argument

February 22, 2011 International Tax CooperationTaxation in France

Sarkozy expressions 8France is once again urging governments across the world to instate an extensive financial transactions tax, saying that it would be an ideal tool for raising funds towards environmental and development projects, while reducing the occurrence of excessively risky speculative activities by financial institutions.

At the recent weekend’s meeting of Finance Ministers and Central Bank Governors from G20 nations in Paris, France came forward to once again spearhead a drive for an international financial transactions tax (FTT). France’s determination to instate the tax was summarized by the French Finance Minister Christine Lagarde, in a television interview on February 20th, where she said , “…no matter what, along with other countries that are willing, we plan to put into place financial taxation.”

Following the Meeting, the French Finance Minister suggested that Germany also approves of a FTT system, and is currently investigating its feasibility. She noted that throughout the meeting, representatives of the US were staunchly against the FTT. The Minister added, “…it would be ideal for everyone to agree to it but the problem today is that a certain number of countries do not agree.”

At the meeting, French President Nicholas Sarkozy vowed to use his term as the chair of the G20 to make steps towards positive overhauls to the international financial system and curb excessive financial speculative activities. According to statements made by both Nicholas Sarkozy and Christine Lagarde during the meeting, a FTT is an ideal tool to for governments to raise funds for climate change projects.

Photo by Ewan McIntosh