Ten European member states strongly support the European Financial Transaction Tax (EUFTT). It appears that the introduction of an EUFTT is closer than ever as these states have now mandated the European Commission to draft a directive on this tax on financial transactions.
13 Oct 2016
Over recent years the EUFTT has been a hot topic within Europe. However, member states have struggled to reach a joint agreement as the height and scope of the tax could not be agreed. In the meantime, France and Italy have individually introduced a financial transaction tax, which are now awaiting a formal decision from the EC.
Since 2012 eleven countries have worked together, based upon “enhanced cooperation” which requires at least nine member states to participate, with the aim to introduce a financial transaction tax. However, Estonia dropped out from negotiations last year, but the remaining ten member states have continued to move forward together. It is worth noting that from the beginning the United Kingdom and the Netherlands have not supported the introduction of this tax. The UK previously filed a lawsuit with the European Court of Justice about the impact of the tax on non-participating member states. In light of the recent Brexit referendum result it will be interesting to see if the UK decides to take further action.
Now that the European Commission has been mandated by these ten member states to draft legislation the potential introduction of an EUFTT is significantly closer than ever before.
At KAS BANK we will be closely monitoring developments about this subject over the coming months and will be keeping you updated on how this progresses.
If you would like to enquire further about the EU FTT, please contact your Service Manager or our internal FTT Task Force consisting of Marc Weijkamp (Senior Specialist, Custody and Tax) or Henk Brink (Senior Market Intelligence Specialist).