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

This is tiresome because proponents will use it to claim the idea has widespread support, even though the MEP's votes do not necessarily have the endorsement of the Countries they represent.
Fortunately European Parliament Resolutions have no legislative consequence, so while it is a propaganda setback it is probably nothing to be too worried about.

Another article on the same subject from the (UK) Telegraph:

http://www.telegraph.co.uk/finance/...ament-approves-Tobin-tax-on-transactions.html
 
Quote from Explorer:

This is tiresome because proponents will use it to claim the idea has widespread support, even though the MEP's votes do not necessarily have the endorsement of the Countries they represent.
Fortunately European Parliament Resolutions have no legislative consequence, so while it is a propaganda setback it is probably nothing to be too worried about.

Another article on the same subject from the (UK) Telegraph:

http://www.telegraph.co.uk/finance/...ament-approves-Tobin-tax-on-transactions.html
More...

"Under the proposal, the tax would be levied on each financial transaction by banks based in the European Union at a rate of up to 0.05pc – raising as much as €200bn annually."


It's interesting that these articles keep saying that this proposed FTT would be levied on the banks' financial transactions. I just find it hard to believe that they don't understand that this is a direct tax on investors. Unless I completely missed something and ordinary investors would be exempt under this proposal (doubtful).

So it sounds like they are going to push to get this agreed upon in the 17 Eurozone countries. I guess each of those 17 countries would have to agree to this individually. I can't see that happening but if it did all those transactions (and volume) would just take place in other locations. Hopefully this thing just falls apart alltogether...

It's also interesting that the above article mentions that the UK Goverment has a veto over any new Brussels legislation and had made it clear it would seek int'l agreement for any major changes to the banking industury (and that ain't happening)...

-Guru
 
Quote from listedguru:

"Under the proposal, the tax would be levied on each financial transaction by banks based in the European Union at a rate of up to 0.05pc – raising as much as €200bn annually."


It's interesting that these articles keep saying that this proposed FTT would be levied on the banks' financial transactions. I just find it hard to believe that they don't understand that this is a direct tax on investors. Unless I completely missed something and ordinary investors would be exempt under this proposal (doubtful).

So it sounds like they are going to push to get this agreed upon in the 17 Eurozone countries. I guess each of those 17 countries would have to agree to this individually. I can't see that happening but if it did all those transactions (and volume) would just take place in other locations. Hopefully this thing just falls apart alltogether...

It's also interesting that the above article mentions that the UK Goverment has a veto over any new Brussels legislation and had made it clear it would seek int'l agreement for any major changes to the banking industury (and that ain't happening)...

-Guru
More...



Agreed.

http://www.google.com/url?url=http:...on+taX&usg=AFQjCNE12kra_rz2D2kyXV0RRtCLafnkYA




It is highly unlikely a Tobin tax would be accepted by the UK Government unless all the world’s major financial centres, including New York and Hong Kong, also signed up. The Government has a veto over any new Brussels legislation and has made it clear it would seek international agreement for any major changes to the banking industry.

The City of London, as well as Frankfurt and Paris, would almost certainly suffer a mass exodus of financial institutions if the tax was implemented solely in the EU – damaging tax revenues and the British economy. UKIP leader Nigel Farage described the European Parliament vote as an “attack on the City of London” and said the EU going it alone “would be an act of kamikaze economics”.
 
I hope this thing won't happen or at least they don't apply it to residents trading on non-EU markets... It's not that I fear it would spread worldwide, we will all laugh at the consequences for EU if it happens, but I am tired of creating structures and I don't want to relocate( for now...) .Do it France and I swear you won't see my $ ever again ...
 
Couple of interesting tidbits regarding the FTT issue in Europe:

http://www.moneymarketing.co.uk/pen...for-financial-transaction-tax/1027379.article

"The Podimata report suggests a tax of between 0.01 and 0.05 per cent on all transactions to avoid flows towards less regulated parts of the financial sector."

"It adds there should be clearly defined exemptions and thresholds and should take into account the needs of the retail sector, small investors and individuals."

"The European Commission is currently carrying out an impact assessment of the proposal and Cicero Consulting analyst Tim Gieles says the largest group in the parliament, the 265 MEP European People’s Party, has introduced a caveat to its support for the proposal."

He says: “The EPP emphasises that only if the Commission’s impact assessment is favourable to the tax at an EU level will the EPP group support it.”

The Commission supports the FTT at a global level but in the past has suggested that if such a measure is only to be introduced at a European level it would prefer a Financial Activities Tax targeting remuneration of financial service companies.

529 MEPs voted in favour of the report but withdrawl of the EPP’s support could scupper the proposal. No UK MEPs are in the EPP.

The Commission launched its consultation on financial sector taxation in February. It will come forward with legislative proposals later this year.

So it sounds like this upcoming impact assessment could decide the whether or not the FTT is going to remain on life support or the plug will be pulled:)

-Guru
 
Quote from listedguru:

"Under the proposal, the tax would be levied on each financial transaction by banks based in the European Union at a rate of up to 0.05pc – raising as much as €200bn annually."


It's interesting that these articles keep saying that this proposed FTT would be levied on the banks' financial transactions. I just find it hard to believe that they don't understand that this is a direct tax on investors. Unless I completely missed something and ordinary investors would be exempt under this proposal (doubtful).................


-Guru
More...

A quick guess is that the €200bn is several times greater than the profits of the entire EU financial services industry including sectors that won't even be exposed to the trans tax. And none of them question it.

The only thing they say is that the magical tax is small and the revenue is great.

A transaction tax is an operating expense that will have to be passed on to the consumer or leave to a place of lower operating expenses or go out of business.

The IMF states in the Final Report For The G-20, June 2010 about the transaction tax: "Its real burden may fall largely on final consumers rather than, as often seems to be supposed, earnings in the financial sector....A tax levied on transactions at one stage ‘cascades’ into prices at all further stages of production."

They demanded that the IMF conduct another, and another study on the FTT and blatantly ignore the results.
 
Statement by Commissioner Semeta on the European Parliament's vote on innovative financing, including financial transaction tax:

http://ec.europa.eu/commission_2010-2014/semeta/headlines/news/2011/03/20110308_en.htm

"We need a financial transactions tax at global level to help fund our international challenges, such as climate change and development. Europe must be a leader in pushing for this, and I will discuss how to promote a global financial transactions tax with the G20 Presidency when I am in Paris tomorrow."

"With regard to a financial transactions tax at EU-level only, I firmly believe that it is premature to commit to such an option. In fact, taking into account the potential impact that this could have on European competitiveness, it would be irresponsible to proceed with such a tax without first analysing and fully understanding all the implications."

"The Commission is currently preparing an in-depth analysis of all the options for taxing the financial sector, which it will present by the summer. Taking into account the divergent views that we have seen on this issue, it is my duty as Commissioner for Taxation to also examine in detail other potential options, such as a Financial Activities Tax. This will ensure that we find the best solution for taxing the financial sector within the EU."


Reading between the lines it seems to me that if they can't get agreement on an global FTT (which they won't) then a FAT tax would be more suitable as opposed to an EU wide FTT (which is unlikely anyway, IMHO)...

-Guru
 
Quote from cstfx:

Let's just say for the sake of argument, the WH and Congress begin to get soft on this issue and gravitate toward the "yea" crowd. How long do you think would we have to figure a way around this? 2 yrs? 3 yrs? 5 yrs? (figuring approval, logistics, etc)
More...

Today's FTT resolution is a confession letter to the US, Canada, Hong Kong, Switzerland, and other hold-outs that they in fact do have guinea pigs that are willing to "go it alone", and thus the hold-outs have even more incentive to not implement the tax as they sit back and monitor the results of the experiment.

So, to answer your question, let's give the EU or some subset thereof 2 years to develop and implement the tax, and then give the hold-outs 2 or 3 years to watch as the experiment unfolds. Thus, I think you're looking at 4 or 5 years before any of the hold-outs have a reason to consider flip-flopping.

The UK and Sweden both spoke out strongly against the European Parliament vote today, so unless France and Germany can find a way go it alone, an FTT is still a low probability event despite today's vote (IMO).
 
You must log in or register to reply here.
Back
Top