Transaction Tax in the Spotlight Again

October 10, 2012 International Tax CooperationTaxation in EU

European CommissionLUXEMBOURG – The long debated topic of a financial transaction tax is gaining traction in Europe, and could be instated in several EU countries by the end of 2014.

In a press release issued on October 9th following a meeting of the Council of the European Union on economic and financial affairs it was confirmed that Estonia, Italy, Slovakia and Spain have now pledged their support to the implementation of a new tax on transactions of bonds, shares and derivatives traded in Europe.

According to the press release Austria, Belgium, France, Germany, Greece, Portugal and Slovenia have previously confirmed their support of the measure and have already lodged their requests to the European Commission for a transaction tax to be implemented.

Previous attempts to initiate the tax have met with failure as they did not garner unanimous support from all EU countries.

Permission to pursue the implementation of the tax can now be granted by the Council of the European Union, as part of the “enhanced cooperation” procedures outlined in the Treaty on European Union.

A proposal to allow the “enhanced cooperation” will be submitted to the Council by the EC, but only after the Commission receives an outline of the cooperation from at least 9 EU countries.

Commenting on the prospect of a transaction tax in Europe, Finance Minister of Austria Maria Fekter said that work on the new measure will begin soon, and the tax could be approved by 2014, if it passes all necessary procedures.

Photo by tiseb