img1 img2
logo
img3 img4
 

 

The German campaign for the FTT (Steuer gegen Armut) had a meeting in the finance ministry with Hartmut Koschyk, deputy of finance minister Schäuble, on the 10th of June.  
 
On the proposal of Koschyk, we also met secretary of state Hans Bernhard Beus, who is head of the tax department in the finance ministry. 
 
 
The meeting took place in the context of some important developments with regard to the FTT:
- on the 9th of June a debate on the FTT in the German parliament took place,
- also on the 9th there was a hearing of the German finance committee with EU tax commissioner Semeta, in which all German parties expressed their support for the FTT. Semeta promised an unprejudiced and neutral impact assessement of FTT and FAT, 
- on the 8th of June the commissions on Finance and on Europe of the French Assemblée Nationale had adopted with the support of Sarkozy's party a resolution with cornerstones of a tax (see my mail from june 7th or http://www.assemblee-nationale.fr/13/ta-commission/r3456-a0.asp). This might indicate a rapprochement to the German position. 
 
The main messages from our meeting in the finance ministry are the following:
 
1. Koschyk confirmed the position of the government as presented by Schäuble in the parliament May 21st 2010. They want a broad based tax on trade with all classes of financial assets and a low tax rate. 
 
2. This position is based on a formal decision of the presidium of the Christian Democratic Party (Merkel's party) and a decision of the cabinet.  
 
3. The FTT should be introduced in the EU. If this is not possible it should be implemented in the Euro zone, although the German Liberal Party (which is part of the governmental coalition), does at present not yet agree with a Euro zone solution.   
 
4. The government considers France to be its most important ally, as demonstrated by the common initiative of French finance minister Lagarde and Schäuble during the Belgian EU presidency, to discuss the issue in the ECOFIN (EU council of finance ministers). Hereafter the ECOFIN had mandated the European Commission (EC) to prepare the impact assessment on the FTT and the FAT.      
5. For certain elements of design of the tax there is still a need for further coordination. For instance the French have been inclined towards a tax on currency transactions, whereas the Germans want the inclusion of all financial instruments, i.e. shares, bonds and derivatives.   
6. The German tax department works with the relevant partners on the French side on a joint position paper. At this level there are phone calls, mails, video conferences and physical meetings. While on German side, all activities are centralized in one department, the competences on the French side are more complex. This might explain deficits in communication which had been voiced publicly.  
7. The next landmark will be the publication of the impact assessment of the EC, which is expected before summer break. Behind the background of the resolution of the European Parliament (in favour of the FTT at EU level) and the (above mentioned) statement of commissioner Semeta June 9th, the German government expects an unprejudiced and neutral presentation of the pros and cons of the FTT and the FAT.  
8. With regard to the FAT, the government considers the bank levy (which has been introduced in Germany this year) as an instrument similar to the FAT (i.e. they see the FTT as additional instrument to the bank levy).
9. The federal government is in contact with the Polish government, which will have the next EU-presidency, in order to  keep the FTT on the EU agenda. 
10. With regard to the UK they believe that it is still useful to lobby the British, given their financial constraints. Also the decisions of the European Parliament in favor of a European solution would have an impact on UK. In addition Switzerland should be included in a strategy for the FTT
11. Tax evasion is seen as the biggest danger for the implementation of the FTT. Therefore, this issue has to be considered carefully in the design of the tax. 
 
We also submitted our proposals: 
a. Common declaration of the French and German government before or after the release of the impact assessment. They will check this option.   
b. Meeting between French and German ministries together with civil society of both countries. This is seen as an option, which, however, would have to be agreed with the French government. 
c. A resolution of the Christian Democratic Party comparable to the above mentioned resolution in the French Assemblée Nationale. This is not in the competence of the finance ministry and would have to be done by the party.
 
d. A pre-emptive resolution of the Bundestag. Here again, this is not in the competences of the fiance ministry, but there might be a possibility for an all party position after the release of the impact assessment. 
 
e. A diplomatic initiative (if possible together with France) towards other EU member states and Euro zone countries, as well as towards important emegring countriessuch as Brazil and South Africa. They consider this as an option.

   

Focus on
Search
Interesting links
Follow me
facebook twitter rss