LUXEMBOURG (Reuters) - Political agreement is close on a tax on financial transactions after talks on Saturday between finance ministers of the 11 European Union countries willing to introduce the levy, EU Economics Commissioner Pierre Moscovici told reporters.
“Today we made important, if not decisive, progress ... This deal is within reach,” Moscovici said after the meeting in Luxembourg, adding the target is to seal an agreement before the end of the year.
Germany and France proposed the financial transaction tax (FTT) in 2012 in the midst of the euro zone debt crisis. As much a political symbol as an effort to correct the excesses blamed for the worst financial turmoil in decades, it has been debated ever since.
Only 11 of the 28 countries of the European Union accepted in principle the introduction of the FTT, which would complement similar levies already in force in some European countries, such as Germany.
“We made important steps ahead,” Italy’s finance minister Pier Carlo Padoan told reporters after Saturday’s meeting.
Ministers from Germany and France echoed his view, although a further meeting will be necessary in October to find common ground on how to levy the tax, on which financial products, and its rate.
Finance ministers from Germany, France, Italy, Austria, Belgium, Estonia, Greece, Portugal, Slovakia, Slovenia and Spain have met several times to strike a deal, so far to no avail.
The introduction of the tax was initially foreseen in 2014, but the start date was postponed to January 2016 before a new target was set to reach a political deal by December, and to have the tax in place by 2017.
“After the (political) decision, it takes time for the FTT to function, something like nine months to a year,” Moscovici told reporters.
Reporting by Francesco Guarascio; Editing by David Holmes