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The struggle over the Financial Transactions Tax. A politico-economic farce

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  • Stephan Schulmeister

Abstract

The struggle over the FTT has developed in three phases. In the first phase (2009 to 2011) the supporters of the tax went on the offensive, supported by the ?shock effects? of the financial crisis. This phase ended with the (preliminary) ?victory? in the form of the FTT proposal of the European Commission (EC) in September 2011. The second phase was shaped by the search for ways how to implement the FTT within the EU. It ended with the publication of a modified FTT proposal by the EC in February 2013 as basis for the implementation in 11 Member States. The last phase has been marked by a strong counter-offensive of the financial lobby which succeeded in playing off FTT supporting countries against each other, in particular Germany and France. This phase ended with a defeat of the FTT supporters. Not even in a group of EU Member States will a general FTT be implemented in the foreseeable future. The struggle over the FTT was mainly carried out in two ?battlefields?, the intellectual disputes between economists at universities, research institutes and international organizations, and the political controversies between NGOs, political parties, governments and pressure groups, in particular the finance industry.

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  • Stephan Schulmeister, 2015. "The struggle over the Financial Transactions Tax. A politico-economic farce," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(5), pages 15-55.
    • Handle: RePEc:cai:reofsp:reof_141_0015
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    References listed on IDEAS

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    1. Stephan Schulmeister, 2011. "Implementation of a General Financial Transactions Tax," WIFO Studies, WIFO, number 41992, April.
    2. Schulmeister, Stephan, 2006. "The interaction between technical currency trading and exchange rate fluctuations," Finance Research Letters, Elsevier, vol. 3(3), pages 212-233, September.
    3. European Commission, 2010. "Financial Sector Taxation," Taxation Papers 25, Directorate General Taxation and Customs Union, European Commission.
    4. Stephan Schulmeister, 2009. "Technical Trading and Trends in the Dollar-Euro Exchange Rate," WIFO Studies, WIFO, number 37582, April.
    5. Stephan Schulmeister, 2008. "Profitability of Technical Currency Speculation. The Case of Yen-Dollar Trading 1976-2007," WIFO Working Papers 325, WIFO.
    6. Arnoud W. A. Boot & Lev Ratnovski, 2016. "Banking and Trading," Review of Finance, European Finance Association, vol. 20(6), pages 2219-2246.
    7. Schulmeister, Stephan, 2009. "Profitability of technical stock trading: Has it moved from daily to intraday data?," Review of Financial Economics, Elsevier, vol. 18(4), pages 190-201, October.
    8. Gorton, Gary & Metrick, Andrew, 2012. "Securitized banking and the run on repo," Journal of Financial Economics, Elsevier, vol. 104(3), pages 425-451.
    9. Stephan Schulmeister, 2012. "Technical Trading and Commodity Price Fluctuations," WIFO Studies, WIFO, number 45238, April.
    10. European Commission, 2010. "Innovative Financing at a Global Level," Taxation Papers 23, Directorate General Taxation and Customs Union, European Commission.
    11. Stephan Schulmeister, 2010. "Boom-Bust Cycles and Trading Practices in Asset Markets, the Real Economy and the Effects of a Financial Transactions Tax," WIFO Working Papers 364, WIFO.
    12. Stephan Schulmeister, 2002. "Technical Trading Systems and Stock Price Dynamics," WIFO Studies, WIFO, number 23373, April.
    13. Stephan Schulmeister, 2008. "Components of the profitability of technical currency trading," Applied Financial Economics, Taylor & Francis Journals, vol. 18(11), pages 917-930.
    14. Robert Pollin & Dean Baker & Marc Schaberg, 2003. "Securities Transaction Taxes for U.S. Financial Markets," Eastern Economic Journal, Eastern Economic Association, vol. 29(4), pages 527-558, Fall.
    15. Vasilev, Aleksandar & Maksumov, Rashid, 2010. "Critical analysis of Chapter 23 of Keynes’s Notes on Mercantilism in The General Theory of Employment, Interest and Money (1936)," EconStor Research Reports 155318, ZBW - Leibniz Information Centre for Economics.
    16. Peter Hördahl & Michael R King, 2008. "Developments in repo markets during the financial turmoil," BIS Quarterly Review, Bank for International Settlements, December.
    17. Stephan Schulmeister & Margit Schratzenstaller & Oliver Picek, 2008. "A General Financial Transaction Tax. Motives, Revenues, Feasibility and Effects," WIFO Studies, WIFO, number 31819, April.
    18. Stephan Schulmeister, 2007. "Aggregate Trading Behavior of Technical Models and the Yen/Dollar Exchange Rate," WIFO Working Papers 294, WIFO.
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    Cited by:

    1. Capelle-Blancard, Gunther, 2016. "The abrogation of the “Impôt sur les opérations de bourse” did not foster the French stock market," Finance Research Letters, Elsevier, vol. 17(C), pages 257-266.
    2. Stephan Schulmeister, 2014. "Die große Depression, der New Deal, ihre Bewertung durch den Mainstream und die Krise Europas," WIFO Working Papers 483, WIFO.
    3. Stephan Schulmeister, 2014. "Von Roosevelt lernen: Sein "New Deal" und die große Krise Europas," WIFO Working Papers 473, WIFO.
    4. Sarah Godar & Christoph Paetz & Achim Truger, 2015. "The scope for progressive tax reform in the OECD countries. A macroeconomic perspective with a case study for Germany," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(5), pages 79-117.
    5. Roman Šperka & Irena Szarowská, 2015. "Impact of a Financial Transaction Tax on a Financial Market," Working Papers 0013, Silesian University, School of Business Administration.

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