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The EU Financial Transactions Tax: Antecedents and Current Debate

  • Yiannis Kitromilides


    (Centre for International Business and Sustainability, London Metropolitan University, UK)

  • Ana Rosa González


    (Department of Applied Economics V, University of the Basque Country, Spain)

Registered author(s):

    The paper deals with the development of the Financial Transactions Tax (FTT) policy idea and its feasibility in the absence of global coordination. New taxes are evaluated in terms of how they fit into existing national tax systems. Increasingly, however, cross-border issues assume greater significance in tax design and this is particularly pertinent in the case of FTT which has a long history. The various changes in tax systems and the economic environments within which they operate since the original “Tobin Tax†proposal are noted and the way they affect the debate on FTT are discussed. The proposal to introduce a unilateral FTT in the EU and its feasibility are examined. In terms of achieving its fundamental objectives the feasibility of the tax is crucial unless, as may be the case in the UK, the need to rebalance the economy away from the financial sector is a more urgent priority.

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    Article provided by Savez ekonomista Vojvodine, Novi Sad, Serbia in its journal Panoeconomicus.

    Volume (Year): 60 (2013)
    Issue (Month): 3 (May)
    Pages: 311-321

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    Handle: RePEc:voj:journl:v:60:y:2013:i:3:p:311-321
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    1. Diamond, Peter A & Mirrlees, James A, 1971. "Optimal Taxation and Public Production II: Tax Rules," American Economic Review, American Economic Association, vol. 61(3), pages 261-78, June.
    2. Arestis, Philip & Sawyer, Malcolm, 1997. "How Many Cheers for the Tobin Transactions Tax?," Cambridge Journal of Economics, Oxford University Press, vol. 21(6), pages 753-68, November.
    3. Thornton Matheson, 2011. "Taxing Financial Transactions: Issues and Evidence," IMF Working Papers 11/54, International Monetary Fund.
    4. European Commission, 2009. "Taxation trends in the European Union: 2009 edition," Taxation trends 2009, Directorate General Taxation and Customs Union, European Commission.
    5. Phillip Anthony O’Hara, 2011. "International Subprime Crisis and Recession: Emerging Macroprudential, Monetary, Fiscal and Global Governance," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 58(1), pages 1-17, March.
    6. John Brondolo, 2011. "Taxing Financial Transactions: An Assessment of Administrative Feasibility," IMF Working Papers 11/185, International Monetary Fund.
    7. Rafal Raciborski & Julia Lendvai & Lukas Vogel, 2012. "Securities Transaction Taxes: Macroeconomic Implications in a General-Equilibrium Model," European Economy - Economic Papers 450, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    8. James Tobin, 1978. "A Proposal for International Monetary Reform," Eastern Economic Journal, Eastern Economic Association, vol. 4(3-4), pages 153-159, Jul/Oct.
    9. European Commission, 2011. "Taxation trends in the European Union: 2011 edition," Taxation trends 2011, Directorate General Taxation and Customs Union, European Commission.
    10. John Y. Campbell & Kenneth A. Froot, 1993. "International Experiences with Securities Transaction Taxes," NBER Working Papers 4587, National Bureau of Economic Research, Inc.
    11. John Grahl, 2003. "Sand in the wheels or spanner in the works? The Tobin tax and global finance," Cambridge Journal of Economics, Oxford University Press, vol. 27(4), pages 597-621, July.
    12. European Commission, 2013. "Taxation trends in the European Union: 2013 edition," Taxation trends 2013, Directorate General Taxation and Customs Union, European Commission.
    13. Summers, L.H. & Summers, V.P., 1989. "When Financial Markets Work Too Well : A Cautious Case For A Securities Transactions Tax," Papers t12, Columbia - Center for Futures Markets.
    14. European Commission, 2012. "Taxation trends in the European Union: 2012 edition," Taxation trends 2012, Directorate General Taxation and Customs Union, European Commission.
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