Brussels, 27/01/2015 (Agence Europe) - Under the impetus of France and Austria, the finance ministers of the country involved in enhanced cooperation on the financial transactions tax (FTT) have decided to change their working method, in view of the little progress made so far. They have published a joint statement reiterating their commitment to “implement the FTT” on 1 January 2016. Greece, which is currently forming its new government, did not sign the document.
On Monday evening, the French finance minister, Michel Sapin, explained that the enhanced cooperation was still an unknown quantity in terms of its method of operation. “We were able to test it out last year with results in terms of progress in work which reflected the lack of organisation” (our translation). For example, the participant states are not allowed to meet in the buildings of the Council. So far, proposed compromises have come mainly from the rotating Presidencies of the Council, but Latvia, which is currently at the helm, is not involved in the enhanced cooperation.
A decision has therefore been made that there will be a permanent president, the Austrian Minister, who will be responsible for calling meetings, planning the organisation and contact between meetings. There will be a permanent technical group, which will be led by Portugal. “Ultimately, we wanted the Commission to be more present, particularly at a technical level, on the design of the proposals and the measures and consequences” of these proposals. An impact assessment, for example, is expected on the principle of issuance, which is of concern to the smaller countries, which are wondering whether the revenue generated will be at least equivalent to the cost of collecting the tax. “We will be working over the two months ahead of us to provide reassurances”, Sapin said. “There are eleven of us with some small countries, it would just take two of them to leave for there to be no more enhanced cooperation”.
The aim is also to relaunch the work with a focus on a tax with a broad base and a low rate, whilst in recent months, the ministers have been working on the taxation of shares and certain derivatives initially. Each financial centre is said to be vociferously defending the financial instruments of which it is at the forefront. France, in particular, defended equity derivatives. Although the talks held on Monday evening dealt with the method rather than the content, Sapin explained that France had no “misgivings about equity derivatives, we are concerned that it is only equity derivatives, that is why we want to end up with the broadest possible base”. (EL)