Financial Transactions Tax: the Commission Proposal

The Commission has proposed a two pronged approach for the future taxation of the financial sector. At global level, the Commission supports the idea of a Financial Transactions Tax (FTT). At EU level, the Commission recommends that a Financial Activities Tax (FAT).

Globally, estimated tax revenues from FTT would have been around EUR 60 billion for 2006 for stocks and bonds transactions assuming a tax rate of 0.1 %. According to the Commission the FTT would have to be levied on the broadest possible base to reach its efficiency goal.

In contrast to an FTT, whereby each financial market participant is taxed according to his transactions, the FAT taxes financial corporations and it falls on total profit and wages. For the EU-27, the addition-method FAT could raise up to EUR 25 billion.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s