An ECOFIN (Economic and Financial Affairs Council) meeting was held on the 13th March 2012 in Brussels. Ministers discussed the proposed EU financial transaction tax.
Maintaining Malta’s position, Malta’s Minister of Finance, Tonio Fenech, held that a financial transaction tax will create additional burdens for smaller Member States and such burdens would not be sufficiently set off by the revenue created. The tax would increase the cost of lending and the cost of capital for companies and governments. Apart from economic and financial implications, the tax would need to be enforced legally and collected. In all, Mr. Fenech maintains that the tax would impede competitiveness and have a detrimental effect on jobs.
Mr. Fenech told the Council that “Although it is true that we need to tackle the banking system and give a clear message that they must contribute more, my concern is that the banking system is the blood veins of the world economy and punishing your own blood veins may cause problems to your own body”.
Mr Fenech went on to say that the financial transaction tax is thus an inefficient tax. Other member states which do not support the introduction of the tax throughout the EU include the UK, Sweden and the Czech Republic. On the other hand, France has indicated that it may move forward with the initiative, together with Austria, Belgium, Finland, Germany, Greece, Italy, Portugal and Spain, under the enhanced cooperation procedure.
An ECOFIN (Economic and Financial Affairs Council) meeting was held on the 13th March 2012 in Brussels. Ministers discussed the proposed EU financial transaction tax.
Maintaining Malta’s position, Malta’s Minister of Finance, Tonio Fenech, held that a financial transaction tax will create additional burdens for smaller Member States and such burdens would not be sufficiently set off by the revenue created. The tax would increase the cost of lending and the cost of capital for companies and governments. Apart from economic and financial implications, the tax would need to be enforced legally and collected. In all, Mr. Fenech maintains that the tax would impede competitiveness and have a detrimental effect on jobs.
Mr. Fenech told the Council that “Although it is true that we need to tackle the banking system and give a clear message that they must contribute more, my concern is that the banking system is the blood veins of the world economy and punishing your own blood veins may cause problems to your own body”.
Mr Fenech went on to say that the financial transaction tax is thus an inefficient tax. Other member states which do not support the introduction of the tax throughout the EU include the UK, Sweden and the Czech Republic. On the other hand, France has indicated that it may move forward with the initiative, together with Austria, Belgium, Finland, Germany, Greece, Italy, Portugal and Spain, under the enhanced cooperation procedure.