Eleven EU countries have been given the green light by the European Parliament to introduce a Financial Transaction Tax (FTT).
Austria, Belgium, Estonia, France, Germany, Greece, Italy, Portugal, Slovakia, Slovenia and Spain have all announced their intention to introduce the tax which aims at making the financial sector take more responsibility for the crisis it caused and discouraging the types of risk-taking which precipitated the crisis.
The eleven countries together account for about 90 per cent of Eurozone GDP and include 4 of the EU’s 5 biggest economies, with the notable exception of the UK.
It is estimated that the tax will generate at least €37 billion which can be used not only to offset the costs incurred by governments in bailing out the banks, but for socially-useful purposes such as funding development and policies to combat climate change. An FTT in Germany alone will raise approximately €10bn per year.
Now that the Parliament has given its approval, a majority vote is needed in the European Council to give the European Commission the go ahead to turn the FTT plans into reality.