Leaked EU document proves financial transaction tax is legal

A leaked European Commission document dispels earlier warnings that the financial transaction tax (FTT) which 11 EU countries agreed to put in place by next year breaches EU or international laws.

In reaction to the news, Natalia Alonso, Head of Oxfam’s EU Office, said:

“This document puts to bed any legal concerns about the financial transaction tax. With Germany's new coalition highlighting the tax as a key priority, the 11 participating EU countries should now clinch a deal before the European Parliament elections in May.

“Those who bear the least responsibility for the economic crisis have suffered the most, and a Robin Hood tax would make things right. Governments must agree to spend a good chunk of its revenues to help poor people get back on their feet, and combat climate change”.

“The banks will continue to oppose plans to make an FTT a reality, but any tax that didn’t draw such a response from the financial sector would clearly be badly designed.”

Notes to Editors

The coalition agreement in Germany drawn up between the Christian Democrats and Social Democrats calls for the quick introduction of a broad-based EU FTT covering all financial products, as well as annual increases in development spending to meet their 0.7% overseas aid target.

The 11 EU countries who decided to put an FTT in place by 2014 are: Germany, France, Italy, Spain, Austria, Belgium, Estonia, Greece, Portugal, Slovakia and Slovenia.

The European Commission estimated that an Financial Transaction Tax by these 11 EU countries could raise €35billion every year.