EU Financial-Transaction Tax States Meet as Skepticism Grows

The 10 European Union countries working on a financial-transaction tax will hold talks tomorrow as skepticism grows about the plan’s feasibility.

The meeting will be held before a scheduled meeting of euro-area finance ministers in Luxembourg, according to the Austrian Finance Ministry. EU finance ministers are scheduled to review progress on the proposed tax when they convene there on Friday. The tax group set an end-June deadline for resolving open issues in the plan.

The Finance Ministry of Slovenia, which has raised concerns over the viability of the tax, said on Wednesday that while it supports the effort, “such a tax has to have a positive financial contribution” for the 10 countries involved in the talks. In Luxembourg, Slovenia will “aim toward solutions that make economic sense,” the ministry said.

Plans for a transaction tax already failed among all 28 EU nations, and the current talks are seeking a compromise among a smaller group that sought to press on under “enhanced cooperation” rules, which require consensus from at least nine nations.

Austrian Finance Minister Hans Joerg Schelling, who’s leading the talks, said last week that the number of participating countries may decrease, putting an end to the project. The countries still at the table are Austria, Belgium, France, Germany, Greece, Italy, Portugal, Slovakia, Slovenia and Spain.

Slow Progress

Efforts to agree on a joint European transactions tax have moved slowly in the past four years amid disagreements over which trades to tax and how to allocate the revenue. In December, Estonia left the negotiating group. In May, Belgian Finance Minister Johan Van Overtveldt signaled his country might pull out of the talks. Italy was said to be wavering.

Schelling said Belgium and Slovenia are potential dropouts.

The Slovenian Finance Ministry said it would support a tax that’s “not too administratively burdensome for taxable persons and designed in a way that would be easy to manage and collect.”

The Italian government is “still engaged and thinks it’s possible to find an agreement on the remaining issues,” according to the Finance Ministry.

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