EU to seek alternatives to financial trading tax

German finance minister says UK’s stamp duty possible model.

European Union member states are to look at alternatives to a full-scale financial transaction tax after a meeting of finance ministers moved the matter no closer to consensus.

Wolfgang Schäuble, Germany’s finance minister, presented a document to his 26 counterparts at the meeting in Copenhagen on Friday, which suggested implementing a watered-down tax on share transactions as a first step.

His document said that this should be “guided by the overall approach of the British stamp duty” or France’s tax on financial transactions, which does not include the trading of derivatives.

“While this first step is put in place, we have to work to extend taxation to other instruments so that we can achieve the comprehensive taxation of financial transactions as proposed by the Commission,” Schäuble’s document said.

EU officials will now work on coming up with alternatives in order to reach an arrangement that as many member states as possible can agree to. The UK, the Netherlands, Denmark and Sweden have all said that they would not back the scheme in its current form.

The Commission proposed a financial transaction tax in September. It suggested a 0.1% levy on share dealings and 0.01% on the trading of other financial products, to bring in an estimated €57 billion.

Denmark’s finance minister Margrethe Vestager said that member states were still far away from a compromise.

“The prime focus of today’s discussion was to find a way forward to satisfy all the different interests,” she said.  “We are looking at how to bring the financial sector back on track.”

“What we are gathering today is ideas because it is extremely difficult to get unanimity on the Commission proposal. “

Algirdas Šemeta, the European commissioner for taxation, said that he believed that today’s discussions showed that there was “still energy and momentum” towards a transaction tax at EU level.