Financial transaction tax
Lowering contributions possible even under enhanced cooperation
By Gaspard Sebag | Friday 31 August 2012
Even under enhanced cooperation, a financial transaction tax (FTT) can reduce national contributions for those member states participating, states the European Commission in a non-paper published on 25 July and seen by
In their June European Council conclusions, EU leaders noted that the Commission’s FTT proposal “will not be adopted by the Council within a reasonable period,” owing to the opposition of the United Kingdom and Sweden. “Several member states will therefore launch a request for enhanced cooperation in this area, with a view to its adoption by December 2012,” add the 27 leaders. A group of at least nine - the minimum threshold for establishing enhanced cooperation - is currently being formed to that end.
To see whether - despite this turn of events - the FTT is still eligible as an own resource that could feed into the EU budget, the Commission examined the legal, procedural and budgetary aspects involved. It concluded two things. Firstly, a financial transaction tax under enhanced cooperation can legally become the base for a new own resource. Secondly, those participating could transfer a share of the FTT revenue they collect to the EU budget and in exchange see their GNI-based contribution go down. There would be no impact whatsoever on the national contributions of non-participating countries.
If this were to go through, a new method of calculating the national GNI-based contributions would have to be devised taking into account the revenue generated for the EU budget by an FTT in a sub-group of member states. The Commission adds that the revised method would need to be sufficiently general so that no further adjustments are necessary in case additional member states decide to join the enhanced cooperation.