1/4% Tax on all stock trades pushed in NY Times today

Berlin (dpa) - German Chancellor Angela Merkel proposed Thursday the creation of new European Union funds for special projects to be financed by the money raised through a financial transactions tax.

Speaking in parliament ahead of a summit of the 27 EU leaders in Brussels Thursday, Merkel said the funds would result in an increase in competition.

The chancellor said that EU states that are not members of the 17-state eurozone could also participate in the funds.

http://en.europeonline-magazine.eu/...unds-financed-by-transactions-tax_244297.html

Presumably a special project for making up losses in GDP caused by a transaction tax isn't what she is thinking of.
 
Quote from Explorer:

The French financial transaction tax has hit small cap stocks "particularly hard
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What would be mechanism for FTT hitting small caps?

My impression was that French FTT is limited to companies with capitalization of more than 1 billion euros.

Anyone would like to comment on it because I do not have any French FTT details handy.
 
Quote from vicirek:

What would be mechanism for FTT hitting small caps?

My impression was that French FTT is limited to companies with capitalization of more than 1 billion euros.

Anyone would like to comment on it because I do not have any French FTT details handy.
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You are right. It's perhaps the HFT part of the french FTT. If volume was coming from a HFT firm based in France that didn't have the "market maker" status( exempted of all taxes ), they simply stopped trading. Anyway 26 % is not a big figure. It would be great to see the effect on SBF 120...
 
Quote from TraDaToR:

Thanks for correcting. I think the number I heard was for high net worth residence scheme. They pay a ticket but then far less on their income( 12%).

Perhaps we should create an " where to escape from EU FTT?" thread instead of posting here...
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That's a great idea. There is no sense in EU FTT and in this scenario arguing with logic is not a worthwhile endeavor.
The public is just tilting at windmills and convincing them otherwise is not likely to succeed either.
I think at this point some Asian countries should introduce a kind of trader's visa, would be a smart move on their behalf - if Europe does not want my taxes then I'm sure some other country will.
 
Tomorrow will mark another milestone in the long meandering path towards a international financial transaction tax, otherwise known as the Tobin tax.What exactly will happen? Well the European Commission, the EU’s executive arm, will approve a proposal that paves the way for an avande-garde of member states to agree their own Tobin regime. In EU jargon, it’s a proposal authorising “enhanced cooperation”.

Ironically the step forward will come in the shape of a legal admission of defeat, a formal acceptance that there is at present no consensus for a pan-EU levy, let alone enough for a global one.It is largely a formality.

But it means the 11 EU countries that want the levy will be one procedure closer to setting up their own Tobin tax. Such breakaway groups are considered a last resort under EU rules, so any enhanced cooperation must clear various legal hurdles, including proof that a pan-EU deal is impossible for now.

According to one draft proposal kindly passed to the FT, the commission has unsurprisingly found that the conditions are ripe for the 11 to start cooperation talks. This is likely to be endorsed by a meeting of finance ministers in November. No tax proposal has ever gone to enhanced cooperation, so it is a moment of sorts in the Brussels bubble.

What comes next will be more controversial. As you can see from the document, the proposal does not touch on what the details of the tax, apart from saying it should be broadly based on the commission’s existing proposal. The original proposal aimed to levy the transaction tax on any entities based within the FTT area that trade a financial instrument. This would mean a German bank trading in London would in theory be hit by the levy, but that two US banks trading a German stock would not. While there are some issues of implementation, financial centres are largely unconcerned about this tax design, as they expect it to drive more trading business outside the FTT area.

The commission proposal does mention, however, the potential for the enhanced cooperation plan to tighten up the tax design. “Through a regime along the lines of the original commission proposal it would be possible to address evasive actions, distortions and transfers to other jurisdictions,” the proposal says.

While the options are not laid out, one thought is to apply the tax to instruments issued in the FTT area, or derived from securities based in the FTT area. That, of course, nets a much larger range of transactions involving Chinese, US, Indian or British trading parties that are nothing to do with the FTT zone.


The commission will put forward its thoughts on a regime in the next few months. Some countries outside the FTT may not like the look of it. But once the EU authorises enhanced cooperation, there is not much those outside can do about it, as long as the measures are lawful.
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http://blogs.ft.com/brusselsblog/20...saction-tax-faithful-march-on/?#axzz2AD1TVhRh

So they still think a Chinese man selling an option to an American will pay the tax to authority's hundreds of miles away.
 
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