Europe confused on financial transaction tax - UK

By @ibtimes on

Europe's proposals for a financial transaction tax are deeply confused and the world is unlikely to agree on it, Prime Minister David Cameron said on Monday.

Britain has said it will not introduce such a tax on its own and would only support any international version of it if it was implemented across the board. Some European countries have pushed for a European Union-only tax.

The G20 group of emerging and developed nations last week failed to back a proposal for a new tax on financial transactions to raise funds for poor countries.

If other countries want to introduce new financial taxes at home, including to raise revenue for development, that is for them to decide, Cameron told parliament.

But what they should not do is try to hide behind proposals for an EU tax as an excuse for political inaction on meeting targets for spending on development or indeed climate change.

Cameron said Europe was split over what to do with the proceeds from a so-called Tobin tax -- name after the U.S. economist who first mooted it in the 1970s.

The current proposals for a financial transaction tax in Europe are so deeply confused that different European countries and indeed European institutions have talked about spending the revenues of such a tax in five different ways, Cameron said.

On development, on climate change, on social policy, on resolving the banking crisis, and, most recently, to supplement the EU budget.

Billionaire philanthropist Bill Gates made a formal presentation for a Tobin tax for development purposes to the G20 in Cannes last week but failed to convince sceptics such as the United States, Canada and Britain.

If you could achieve global agreement for a tax of this nature, then there would be a case for it but I think it's very hard to see that happening, Cameron said.

(Reporting by Matt Falloon and Tim Castle; editing by Anna Willard)

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