European Parliament votes in favor of financial transaction tax – now on to implementation!

Members of the European Parliament, voting in Strasbourg on March 8, voted overwhelmingly across party lines to adopt the Eurosocialists proposal for a tax on financial transactions (FTT) as an alternative to austerity. The parliament approved a report by Greek Socialist Anni Podimata calling for the implementation of a 0.05% tax on all financial transactions at European level as a first step towards a global implementation.

The IUF has called for a tax on financial transaction to curb speculative activity for over a decade, arguing that it is eminently feasible to implement unilaterally in key financial centers even while a global tax remains the goal.

Europeans for Financial Reform – an initiative of which the IUF was an early endorser – built pressure on MPs in the runup to the vote and succeeded in generating over a half million messages to Euro MPs.

Even at a modest 0.05, FTT advocates estimate that the tax could generate over 200 billion euros at EU level – double the EU’s current budget – and at least 650 billion if implemented globally.

The task now will be to fight for concrete implementation of the tax – and to deepen similar initiatives in other major centers of financial activity.

Remarks by EU Commissioner Semeta immediately following the vote show the depths of resistance confronting implementation. Despite the 529 to 127 vote in favor, Semeta declared it “irresponsible” and “premature” to establish an FTT in the EU.