European businesses criticise Tobin Tax proposals

EUROPEAN BUSINESS leaders have called for plans to introduce a Tobin Tax in the European Union (EU) to be scrapped.

EU governments, including Germany and France, have expressed their wish to introduce a financial transaction tax, which will impose a 0.1% levy on all transactions between financial institutions within Europe.

In a letter to the Financial Times, representatives of the business committees on the Organisation for Economic Co-Operation and Development and the International Chamber of Commerce, came out against the tax.

They said it could be “disastrous” for Europe and reduce GDP by more than 2% in member countries.

“While an FTT would indeed raise some government revenues in the short term, it would immediately negatively affect the economy and not foster growth,” the letter said.

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