June 28, 2010 / 3:01 PM / 8 years ago

EU to study bank transaction tax after G20: tax chief

BRUSSELS (Reuters) - The European Union’s executive will study whether it should go alone in imposing a tax on financial transactions after G20 leaders failed to agree on the issue, the EU’s top taxation official said on Monday.

The tax would be separate from a bank levy, or a resolution levy, which some governments are proposing to impose on banks to insure them against the costs of any future bailouts.

“We now need to determine if Europe can and should go alone in taxing the financial sector beyond the resolution levy,” EU Tax Commissioner Algirdas Semeta told the European Parliament’s committee on economic and monetary affairs.

“If we want to progress, we must now assess the potential impact of bank taxation on the competitiveness of the EU economy,” he said.

G20 leaders failed to agree on a global banking levy or transaction tax when they met over the weekend in Canada, leaving it up individual countries to decide what to do.

EU leaders instructed their finance ministers last month to work out by the end of October details for the banking levy, but any financial transaction tax remains much more controversial.

Semeta also said the European Commission, the EU’s executive, would assess this year whether to propose that the corporate tax base, or the way in which business taxes are calculated, be harmonized throughout the 27-nation EU.

“We should decide ... whether it should be a common corporate base, or a common consolidated corporate base and whether it should be optional or obligatory,” he said.

Some countries, such as Britain, oppose any move toward tax harmonization in the EU, saying the issue must be purely a matter of national governments and not Brussels institutions.

A study showed on Monday that tax levels are generally high in the European Union relative to other large economies but there are big differences among the 27 member states.

Reporting by Marcin Grajewski; Editing by Ron Askew

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