Brussels, 06/05/2014 (Agence Europe) - Countries not involved in the enhanced cooperation mechanism to introduce a financial transactions tax (FTT) attacked the eleven FTT countries on Tuesday 6 May for lack of transparency and visibility on the potential impact of the FTT in non-FTT countries.
Ten of the FTT countries - Austria, Belgium, Estonia, France, Germany, Greece, Italy, Portugal, Slovakia and Spain - have signed a joint statement outlining areas of agreement. Slovenia did not join them because of the unstable situation domestically. Taxation Commissioner Algirdas Semeta said it was too soon to know how Slovenia would react. The statement was handed to finance minsters at the Ecofin Council. As Austrian Finance Minister Michael Spindelegger said, the ministers agreed on a gradual approach for introducing the tax, which would initially be levied on shares and some derivatives. It remains to be decided exactly which derivatives would be covered in the first stage. He said they wanted to agree on a viable solution by the end of the year so the tax could come into force on 1 January 2016. Semeta added that he thought agreement would be possible later this year. The final issue on which there is consensus is that ministers should have the freedom to decide for themselves which other products should be covered by the tax at the initial stage of its introduction.
Non-FTT countries gave a less than warm welcome to the statement, with the United Kingdom making the first criticisms.
Playing to the electorate. George Osborne, British Finance Minister, said he was concerned about Commissioner Semeta's references to the political timetable and the upcoming European elections. Dutch Finance Minister Jeroen Dijsselbloem agreed, saying that the “pamphlet tells me very, very little, with very small common ground, very vague”. He said they had decided “they must come up with something before the elections” but the statement did not answer the Dutch government's concerns or make it want to join the enhanced cooperation for the FTT, although it had expressed a desire to do so a year ago. In a press release, Natalia Alonso, the head of Oxfam's EU office, said: “With the European elections just around the corner, Ministers seem more concerned with window-dressing for voters”.
Sweden criticised the failure to provide information to non-participating countries, and the Swedish finance minister pointed out that the enhanced cooperation process was new for Ecofin and should be used with caution. He said they had been given “no calculation on the impact, we want to be part of the discussion. There's a technical working group but no political consultation, no calculation, no technical work on the impact on non-participating countries”. Malta, Denmark and Hungary called for transparent, inclusive talks. Commissioner Semeta said that an impact assessment had been carried out by the European Commission, and the “impact assessment clearly demonstrated if introduced in a smart way, this tax could produce a positive effect on our economies and that is clearly stated in the economic impact assessment. We don't know the final design of the tax, but think that the final impact will be clear when final design will be known”.
Osborne said that a number of institutions, including central banks, had expressed concerns about the FTT's potential impact, most recently the European Investment Bank (EIB), which had told finance ministers that very morning that the FTT could negatively impact on EIB loans and scale of lending. Semeta said at a press conference that, if analysis backed these concerns, then appropriate measures would be taken to remedy them. Employers' organisation BusinessEurope and European organisation PensionsFunds have expressed concerns. BusinessEurope has written to the chair of the Ecofin Council, Greek Finance Minister Yannis Stournaras, in this connection.
“We need to hear more, if they seek to damage jobs across Europe we're entitled to challenge that”, said Osborne. Among the FTT countries, German Finance Minister Wolfgang Schäuble called for calm, while Spanish Finance Minister Luis De Guindos said that countries wanted to assess the impact of the tax at each of the introductory stages. (EL)