EU Commission to Study Transaction-Tax Compromise Options

The European Commission will study possible compromises on an 11-nation financial-transaction tax plan, spokeswoman Vanessa Mock said.

Finance ministers narrowed the range of proposals on the table last week in Brussels, without settling on a final plan. As proposals take shape, the commission will conduct impact studies to help nations assess the effect of the tax plans on their domestic economies, Mock said.

“The commission remains convinced of the merits of its initial proposal, but it will also support a reasonable compromise,” Mock said by e-mail. “We are confident that we will be able to reach a swift compromise toward an agreement over the coming months. There is a good working method and process and a political willingness to move forward.”

Participating nations are working to reach a breakthrough in June, when they’ll meet during a scheduled finance ministers’ meeting. Technical talks are slated in the weeks leading up to that gathering, as nations seek to determine what trades would be taxable and how revenues would be allocated.

The commission’s analysis will focus on expected overall rather than country-specific revenues, Mock said. The Brussels-based commission will continue to offer technical assistance as the talks proceed.

The tax plan developments don’t seem to line up with EU efforts to build a capital markets union, the European Banking Federation said on May 15 after its annual meeting in Riga. The EBF board “remarked on the inconsistencies of the political advances in defining a financial transaction tax in some European member states whilst wishing to promote a single capital market.”

Germany, France, Spain, Italy, Belgium, Austria, Portugal, Greece, Estonia, Slovakia and Slovenia are the countries taking part in the transaction-tax talks.

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