Ministers sweep ambitious European Financial Transaction Tax under the carpet

Today Finance Ministers from EU countries which agreed to implement a Financial Transaction Tax (FTT) this year reached a vague initial agreement without any critical substance on the scope of the tax, and failed to reach consensus on what the revenues should be spent on.

In response to today’s news, Natalia Alonso, Head of Oxfam’s EU Office, said:

“With the European elections just around the corner, Ministers seem more concerned with window dressing for voters. Their current compromise does not yet amount to the ambitious FTT needed to ensure that the financial sector is finally made to pay its fair share of tax.”

“Not only have they delayed putting the tax in place until 2016, but they remain worryingly vague on the taxation of derivatives; a key cause of the financial crisis which represent at least two-thirds of the potential revenue.”

“By failing to spell out how the money will be used, governments are sending a worrying signal to the poorest people in Europe and beyond. The FTT has always been associated with helping those hit hardest by the economic crisis and climate change, and leaders cannot back away from this now.”

“Fortunately, our leaders have another chance to prove they work for the people, and not the banks. At Friday and Saturday’s summit, French and German leaders must prevent three years of hard work being wasted by sending a strong signal of their ambition for the tax and committing to allocate its revenues to the fight against poverty and climate change. ”

Notes to Editors

• Download the photos from today’s Robin Hood media stunt in Brussels: “Bankers vs. Robin Hood: boxing match for the poor and the planet”.

• Today’s decision marks the first formal declaration on what kind of FTT will be put in place since Member States agreed to go ahead with the tax in 2012. The FTT will see a small tax imposed on the financial sector which could raise billions for public services like health and education in both Europe and the developing world, and to combat climate change.

• Later this week, on 9-10 May, German Chancellor Merkel and French President Hollande will meet in Stralsund, Germany. This is yet another opportunity for these two key leaders to be ambitious on the scope of the tax (covering all derivatives) and have their say on how the revenues from the EU-11 FTT should be spent on.

• Amongst those who support an ambitious FTT are 1000 economists, MEPs such as Anni Podimata and Arlene McArthy and high-profile public figures, such as Bill Gates.

• Read the Robin Hood tax media brief, which includes facts and figures about why taxing derivatives is so important and what could an FTT pay for in terms of development and climate change

• The 11 EU participating countries are: Austria, Belgium, Estonia, France, Germany, Greece, Italy, Portugal, Slovakia, Slovenia and Spain. Slovenia has declined to sign today’s agreement due to internal issues.