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BackThis week, the draft report of the Greek Social Democrat MEP Anni Podimata on a common Financial Transaction Tax system was debated in the Committee on Economic and Monetary Affairs of the European Parliament. Even though the chief negotiators of the most important political parties appeared to have achieved broad consensus it is not yet clear whether all MEPs will really follow the party line.
The background: during the past year, the European Parliament was one of the most important political forces with regard to the demand to introduce a European Financial Transaction Tax. In her initiative report, the Social Democrat Greek MEP Anni Podimata had already last year successfully enforced the demand of the European Parliament that the European Union should assume a pioneering role concerning the introduction of a long overdue tax on financial speculations, instead of waiting for the whole world to introduce such a tax. The overwhelming majority of MEPs supported Podimata’s trailblazing demand, thereby giving a clear sign to the European Commission and the Member States. They were backed by an unprecedented campaign led by AK the Austrian Federal Chamber of Labour, the Austrian Trade Union Federation ÖGB and other European partners from politics, trade unions and civil society.
The vote by the European Parliament, the will of governments of Member States such as Austria, Germany and France and the continued campaign by AK, ÖGB and co. finally led to the Commission giving up its long sustained resistance against the Financial Transaction Tax and submitting a Directive proposal on the implementation of a European Financial Transaction Tax. What makes it special is the fact that because this concerns issues of tax, the Member States have the sole say in the matter and Parliament can only make non-binding comments on the proposal of the Commission.
Hence, it is even more important for the Greek Vice President of the European Parliament Podimata that Parliament formulates a clear and widely agreed position on the Commission proposal to force the political opponents of a European Financial Transaction Tax, among them Great Britain, Sweden and the Netherlands to take action, as Podimata made clear in her initial comments on her draft report this week in the Committee on Economic and Monetary Affairs of the European Parliament. The chief negotiators of the most important political groups, among them the European People’s Party, the Social Democrats, the Greens and the Liberals would agree on the evaluation of the main points and welcomed grosso modo the proposal of the Commission. The Parliament had introduced amendments to the Commission draft, where it was necessary to make the proposal of the Commission watertight, in order to prevent no shifting of financial transactions and tax evasions. The EPP MEP Sirpa Pietikäinen suggested that Parliament should give some indication in the draft report as to how one should proceed if - as it is to be feared - not all 27 Member States agree to the introduction of the FTT. In her opinion, those countries that were willing to act should nevertheless implement the model of the Commission and not the watered down British version, i.e. the stamp duty. The MEP Sylvie Goulard raised the question on behalf of the Liberals whether it was worth to introduce the FTT if not all 27 Member States participated. Of course, some hardliners and friends of the financial industries also wanted to have their say, such as the Swedish Liberal Olle Schmidt, who went as far as to say that that the FTT was a “bad tax”. The EPP MEP from Luxemburg Astrid Lulling also tried her luck as clairvoyant and predicted the FTT would “never come”. Maybe a pious wish against the background that Luxemburg is home to a number of investment funds?
Even though the chief negotiators of the political fractions are apparently aiming at a broad compromise, after this week’s debate in the Committee of European Parliament it is questionable whether all MEPs will vote with their party whips. We have seen a similar situation already last year when in particular the parliamentary groups of the People’s Party and the Liberals were split. This makes it even more important that the labour representatives and the civil society actively follow the debate in Parliament, including the debate among the Finance Ministers of the Member States and make themselves heard. Those who are responsible for the crisis - the speculators - must finally be made to foot the bill.
Draft report of Rapporteur Anni Podimata on the proposal of the European Commission on implementing a European Financial Transaction Tax systems
The vote by the European Parliament, the will of governments of Member States such as Austria, Germany and France and the continued campaign by AK, ÖGB and co. finally led to the Commission giving up its long sustained resistance against the Financial Transaction Tax and submitting a Directive proposal on the implementation of a European Financial Transaction Tax. What makes it special is the fact that because this concerns issues of tax, the Member States have the sole say in the matter and Parliament can only make non-binding comments on the proposal of the Commission.
Hence, it is even more important for the Greek Vice President of the European Parliament Podimata that Parliament formulates a clear and widely agreed position on the Commission proposal to force the political opponents of a European Financial Transaction Tax, among them Great Britain, Sweden and the Netherlands to take action, as Podimata made clear in her initial comments on her draft report this week in the Committee on Economic and Monetary Affairs of the European Parliament. The chief negotiators of the most important political groups, among them the European People’s Party, the Social Democrats, the Greens and the Liberals would agree on the evaluation of the main points and welcomed grosso modo the proposal of the Commission. The Parliament had introduced amendments to the Commission draft, where it was necessary to make the proposal of the Commission watertight, in order to prevent no shifting of financial transactions and tax evasions. The EPP MEP Sirpa Pietikäinen suggested that Parliament should give some indication in the draft report as to how one should proceed if - as it is to be feared - not all 27 Member States agree to the introduction of the FTT. In her opinion, those countries that were willing to act should nevertheless implement the model of the Commission and not the watered down British version, i.e. the stamp duty. The MEP Sylvie Goulard raised the question on behalf of the Liberals whether it was worth to introduce the FTT if not all 27 Member States participated. Of course, some hardliners and friends of the financial industries also wanted to have their say, such as the Swedish Liberal Olle Schmidt, who went as far as to say that that the FTT was a “bad tax”. The EPP MEP from Luxemburg Astrid Lulling also tried her luck as clairvoyant and predicted the FTT would “never come”. Maybe a pious wish against the background that Luxemburg is home to a number of investment funds?
Even though the chief negotiators of the political fractions are apparently aiming at a broad compromise, after this week’s debate in the Committee of European Parliament it is questionable whether all MEPs will vote with their party whips. We have seen a similar situation already last year when in particular the parliamentary groups of the People’s Party and the Liberals were split. This makes it even more important that the labour representatives and the civil society actively follow the debate in Parliament, including the debate among the Finance Ministers of the Member States and make themselves heard. Those who are responsible for the crisis - the speculators - must finally be made to foot the bill.
Draft report of Rapporteur Anni Podimata on the proposal of the European Commission on implementing a European Financial Transaction Tax systems