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EU states to implement Tobin tax by January 2016

Activists wearing masks depicting German Chancellor Angela Merkel (L) and French President François Hollande back the tax outside the finance ministers' meeting
Activists wearing masks depicting German Chancellor Angela Merkel (L) and French President François Hollande back the tax outside the finance ministers' meeting Reuters//Francois Lenoir

Europe will have a financial transactions tax by the beginning of 2016 at the latest, finance ministers from the 11 European Union countries who back the move decided Thursday. But Britain and Sweden say they will fight the measure.

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A consensus among countries who have agreed to implement the “Tobin tax” on international capital flows has been reached, Austrian Finance Minister Michael Spindelegger said on Thursday.

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“We agreed on the fact that it should be a step-by-step approach, starting with shares and certain derivatives,” Spindelegger said, adding that the first stage should begin on 1 January 2016 at the latest.

France, Germany, Italy and Spain are among the countries that back the idea but Britain, the home of Europe’s biggest financial trading centre, the City of London, is vehemently opposed and it is supported by Sweden.

"Each step towards full implementation (will be) decided in a manner that takes into consideration" the economic impact and the concerns of countries that oppose it, Spindelegger told his colleagues.

British Chancellor of the Exchequer George Osborne promised to fight it, claiming that it would have an effect on countries who do not implement it.

Swedish Finance Minister Anders Borg claimed it would be “inefficient and costly” and promised to keep up criticism of the plan.

The tax, which would be levied on any any transaction, anywhere in the world, carried out by a financial entity which is based in one of the 11 EU states and could bring in 30-35 billion euros, according to the European Commission.

It will be introduced under what the EU’s “enhanced cooperation” procedure, which allows a minority to go ahead with a proposal if it cannot win majority support.

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