Brussels, 12/04/2013 (Agence Europe) - The revised European Commission draft legislation to introduce a financial transactions tax (FTT) in eleven member states by means of an enhanced cooperation mechanism should ensure there are no loopholes that allow companies to carry out transactions (or relocate to) outside the eleven member states, thus making avoidance of the tax more expensive than actually paying it. Thus argues a draft EP opinion on the FTT unveiled on Thursday 11 April at the European Parliament's economic and monetary affairs committee by the rapporteur, Greek Socialist Anni Podimata (see EUROPE 10602 on her previous report on the initial version of the FTT unveiled by the Commission).
Podimata welcomes the fact that the eleven countries have got the Commission to include the “country of emission” idea in the draft directive, a notion recommended by the EP to discourage transactions from being carried out outside the FTT zone because the tax would be levied on financial instruments issued by companies located within the FTT zone even if the instruments are traded outside the zone. She urges the participating member states to harmonise their tax systems so that the “ownership principle” recommended by the EP can be put into practice which echoes stamp duty in the UK by only conferring ownership of a product if the purchaser has paid the stamp duty. This would discourage tax avoidance because the cost of avoiding the tax would be higher than actually paying it. Another way of preventing transactions being shifted to outside the FTT zone would be for it to be levied on over-the-counter derivatives and to apply to bank branches outside the FTT zone in non-EU countries. Podimata urges the Commission to intensify talks with the eleven countries' tax offices to get a clearer picture of the tax. She wants the Commission to alter its definition of non-cooperation jurisdictions. Changes to the draft report have to be tabled by 23 April and the economic and monetary affairs committee will vote on the report at the end of May and the plenary in July. (FG/transl.fl)