While similar plans have been rejected by the US and Britain, the European Union continues to advance discussions on a broad financial transactions tax that would cover most financial instruments including derivatives.
France and Austria sought on Thursday to break deadlocked talks with nine other European countries over a financial transaction tax, by proposing that it be applied to a wide range of transactions but at low rates from next year. But talks have so far floundered over what transactions to tax and at what rate. Various countries tried to win exemptions for securities that would hit their financial institutions particularly hard. Austria, Belgium, Estonia, France, Germany, Greece, Italy, Portugal, Slovakia, Slovenia and Spain...struggled in particular to agree on what derivatives it should cover. Others disagreed. Leaving out the opaque, complex instruments that were blamed for the 2008-2009 financial crisis could undermine the measure as a whole, they said. Britain has long opposed the tax for fear of driving business away from London, home of Europe's biggest financial sector.