On 30 April, the European Court of Justice (ECJ), the EU's highest court of law, dismissed a petition filed by the UK on imposition of a financial transaction tax (FTT) across parts of Europe. In its petition, the UK challenged the decision of the EU Council, which authorised 11 EU nations to implement an FTT under an ‘enhanced cooperation’ scheme. This scheme permits a minimum of nine EU member states to initiate cooperation in different fields, without involving the entire EU membership.
The proposed EU FTT is a small tax (between 0.01% to 0.1%) on specific high-frequency financial transactions. At the ECJ, the UK argued that imposition of an FTT will have “extraterritorial effects” and will adversely impact non-participating EU member states like itself.
In its judgment, the ECJ restricted itself to only analysing whether or not the act granting authorisation for enhanced cooperation violates EU law. The ECJ ruled that the authorisation decision “does not contain any substantive element on the FTT itself”. It stated that the grounds for legal challenge mounted by the UK relate to a potential FTT, which is currently not in operation and consequently dismissed the UK’s petition as premature.
In February 2014, as part of the Robin Hood Tax Coalition, UNA-UK supported petitions to leaders of five EU nations, urging them to implement a robust financial transaction tax. The letters were sent ahead of a meeting between French and German leaders to deliberate on the contents of the proposed FTT legislation due to be introduced by June 2014.
Click here to read the ECJ decision
Click here to read about UNA-UK’s work with the Robin Hood Tax Coalition
Photo: Dotmasters, Robin Hood Tax Campaign, UK
