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1/22/13

‘Robin Hood’ Trading Tax Nudged Forward in Europe as opposing Britain gets sidelined

A hotly contested tax on financial trades took a major step forward on Tuesday when European Union finance ministers allowed a vanguard of member states to proceed with the plan.

The so-called Robin Hood tax would apply a levy to trading in stocks, bonds and derivatives, complex financial products tied to underlying assets like oil prices or interest rates. Although the tax would probably be small — one-tenth of a percentage point or less on the value of a trade — it could earn billions of euros for cash-strapped European governments. 

Algirdas Semeta, the European commissioner in charge of tax policy, called the decision “a major milestone in tax history” and said the levy could be imposed from next year. But deep concerns about how the initiative would work in practice still could mean delays. 

The European Commission, the Union’s policy-making arm, will still need to draft the final legislation and the states in favor of the law will have to give their unanimous approval before it becomes law in the eleven countries that have agreed to send the proposal forward — two more than the minimum required for legislation to be drafted. 

A significant complication is stiff opposition to the tax by Britain, which has the largest trading hub in Europe in the City of London. But because Britain has decided to stay outside the group of states applying the tax, its resistance probably would not stop the plan from moving ahead.

Read more: ‘Robin Hood’ Trading Tax Nudged Forward in Europe - NYTimes.com

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