Step forward but no breakthrough seen on EU financial transactions tax

German Finance Minister Schaeuble addresses a news conference on German government's estimated tax revenues in 2016, in Berlin
German Finance Minister Wolfgang Schaeuble in Berlin, Germany, November 5, 2015. REUTERS/Hannibal Hanschke

November 9, 2015

BRUSSELS (Reuters) – European finance ministers are expected to make some progress on a common financial transactions tax (FTT) at an evening meeting on Monday but are unlikely to seal a definitive deal, officials and ministers said.

Germany and France proposed the FTT in 2012, with the euro zone debt crisis raging, as a way to correct excesses in the financial sector that were blamed for the worst market turmoil and decline for decades. It has been debated ever since.

Britain, Europe’s biggest financial centre, opposes the tax.

Monday night’s discussion between the finance ministers of the 11 euro zone countries that are considering adopting the FTT follows a meeting of all 19 euro zone finance ministers.

Some of the 11 – Germany, France, Italy, Austria, Belgium, Estonia, Greece, Portugal, Slovakia, Slovenia and Spain – already impose such levies at national level.

“I see a chance that we will come a step forward but I am careful with the prediction that we will have a breakthrough today,” German Finance minister Wolfgang Schaeuble told reporters on Monday before euro zone finance ministers met.

Also earlier in the day, French Finance Minister Michel Sapin had called for a quick agreement on the FTT, but other EU officials said that the meeting would not be conclusive.

“We are in a situation in which we have solved almost all open issues. There are special requests by some countries at every meeting. We will try today to solve those issues,” Austrian Finance Minister Hans Joerg Schelling said.

“I have always made clear that if we cannot solve the open issues, then there would not be a solution. And then we have to think about what we can do with this project,” Schelling, who chairs the group of 11 countries who want the FTT, said.

Schelling said that the 11 ministers have already agreed in principle that the FTT should cover all financial products “except sovereign bonds and derivatives on those bonds” but they have not agreed on the rate nor how to implement the charges.

All 28 EU finance ministers meet again on Tuesday in Brussels at the Economic and Financial Affairs Council (ECOFIN).

(Reporting by Tom Körkemeier and Francesco Guarascio; Editing by Louise Ireland)