There may be no halting this tax juggernaut

The latest brainwave from Brussels has the City in its sights, even if Britain goes it alone

Of all the nonsense to have come out of Brussels over the years, there is little quite so self-defeating, politically driven, and generally threatening to economic wellbeing as the proposed new Financial Transaction Tax (FTT), which, as the name suggests, imposes a levy on every transaction between financial institutions. As this week’s dismal GDP figures demonstrate, Europe desperately needs some kind of deregulatory growth agenda, and yet it seems determined only on the reverse. To be pushing ahead with such a stifling and invasive initiative at a time of deepening recession fair takes the breath away.

drjonathanwilson: Jeremy, Your reporting is much better when you do not try to sit on the fence.  Your analysis is faulty in that it does not recognize that the EU is turning itself, in the manner in which capital is allocated, into something akin to the old Soviet Union. Politicians hate capital markets  because they instantly reflect the wisdom of of their policy choices. The EU wants no competition in a liquid capital market, pricing in how capital is allocated. If you ever wanted further proof that the EU is hell bent on becoming a full dictatorship look no further than the FTT. The City would do very well outside of the EU - the City thrives on being inventive. Lord Lawson is quite right in his conclusion - Britain would be much Better off Out How to achieve that - Vote UKIP at every available opportunity. Jonathan

alexlong: Interesting to note that no UKIP MEP voted against this tax. Yet these people are apparently our saviours LOL. 

robbydot: You're lying, alexlong.

londoncynic: When was the vote?  I thought it was still at the draft directive stage.  The measure was proposed by 11 out of 27 governments and given to the Commission to draft the legislation.  Since the aim has always been to clobber the City for cash (original estimate in 2011 was that £50 billion a year - 90% of the FTT -would be raised in London for the EU), they want to inflict it on the UK by the backdoor, with a totally illegal extra-territoriality clause.

ultimatequestion: You can tell he's a socialist troll as he has his gob open in his photo, shouting. Just like rent-a-mob in Edinburgh. The silent majority are speaking now, quietly, politely and persausively with their keyboards, their feet and their pencil in their hands putting an "X" in the box of the UKIP candidate, wherever they can.  I shall prove my statement with a fact: The Rotherham Metropolitain Borough By-Election yesterday (apparently unreported in the Telegraph), a staunch LABOUR area, was taken by the UKIP candidate with 46.5% of the vote.

Ragwin: Won on a turnout of 25.7%.  So essentially low turnout allowed UKIP to pip Labour.  Worth noting the BNP are fairly resilient there as well (that's why it's been kept quiet in the news).  Come a general election with 50% turnout your dedicated UKIP followers will be trampled by Labour.

scorpion_derooftrouser:  Great news. Isn't it interesting that we now have to circulate news among ourselves rather than getting it from newspapers?

glum: Wow! It was the Rawmarsh area UKIP took! Nigel needs to get this on the radar fast as this clearly shows that support for UKIP is now across the board - critical if they are to make real inroads and not just split the vote

delboy36: It is not even interesting that you are telling lies.

pewkatchoo: Liar!

johnhornetooke: The Podimata Report was passed by 487 votes in favour, 152 against, 46 abstentions. UKIP voted against.

mhayworth: So alexlong  just lied outright to smear UKIP?   Does the EU pay these people to do this?  

Epimenides: Yep, they have an enormous propaganda budget and a lot of sockpuppets trolling websites.

fla56: even if they did that's only because bankers are out of control this is the only good idea to come out of the EU i welcome this tax on the socially-useless City-of-London, as do many in the UK

ashestoashes: Surely if Britain left the EU and declared the FTT illegal in Britain, the incentive would be for eurozone banks to come and domicile in Britain then, wouldn't it, so they could avoid the tax too? How would this be bad for the City - it might end up being the biggest draw for foreign investment in years. London gains at the expense of Paris and Frankfurt - oh well, nevermind!

jeremywarner: No, they would still have to pay the tax on trading securities denominated in any FTT country. They could give up trading those securities, but then they would have no business

fla56:  how funny that you think that the EU hasn't thought of that of course the tax will apply across such boundaries numpty! if banks will want to trade with the EU or have any branches there then they pay the tax there will be 'London gains at the expense of' anyways, only good idea to come out of the EU in many years, obviously it reduces the amount of useless financial activity IMO

Oliver Jones: Spot on - especially the last paragraph. A strong financial industry means weakening every other, because all the talent drains to where the money is. The finance industry needs to be cut down to size - at the very least, it needs to be small enough again that its own mistakes do not bring down everything else - and prosperity will return as diversification in expertise brings home the bacon. Right now, money is being mis-allocated every turn you take, because these bankers are making bets on property and other "quick buck" bets. (My dad went off to go and pick strawberries at a "Pick Your Own" field our family has known for decades, only to find that the whole place has been concreted over and covered with flats.) That Britain is making such a huge fuss over this is confirmation of one thing: The UK has ignored every other industry (especially that of engineering) to its detriment, and "bet the nation" on the finance industry. Well, that works fine until you are called on that bet - and the EU has just done that. That you are in this situation is not the "evil" EU's fault - it's your own: You put yourself in this position! As far as I'm concerned, the purpose of this new EU tax is not to declare war on Britain's financial industry and bring everything back to Frankfurt - it is to reduce and eliminate many forms of financial trade to the point where casino-style banking is simply not viable. That's a very good thing, especially when the taxpayer is made to pay for their losses every time a bet goes the wrong way. The EU will get its own karma, I'm sure - but Britain's recovery cannot start without the banking industry being cut down to size. Accept this, because the days of trading bits of paper backed by absolutely nothing but debt are fast coming to an end.

clintboon: EU becoming like the USSR? Please stop exaggerating, read some history and refrain from belittling & insulting the deaths of the 20 million men women and children who died at the hands of Stalin.   The EU is a free trade area, it’s about as communist as McDonalds; further it’s about to close a free trade deal with the whole of North America, creating the largest and wealthiest free trade area in the history of humanity.   As for The City, financial transactions, especially swaps, take investment away from the real economy, you know the economy that most of us work in. A transaction tax will in part attempt to funnel money back into the productive area of the economy rather than the speculative one.   The City and its practises were in large part responsible for the greatest financial crises in 100 years, and as yet no one has gone to jail, no real regulation to prevent another crisis has been introduced; all governments have done is print money under the auspices of monetarism and fill the bank’s own vaults with yet more tax payer funded money! Unbelievable! The banks then refuse to lend this money to the small and medium sized business in the real economy, preferring once again to invest in specualtive financial vehicles via low tax, off-shore jurisdictions.   Seems to me both the EU & the Americans are attempting to protect themselves from The City whilst attempting to bolster their real economies, whilst all we do here in the UK is whine about immigration the phantom EU socialists - convenient for The City and its cronies that eh? Of course, a newspaper owned by two extremely wealthy businessmen who themselves profit from the deregulated nature of The City could never support policy which improves the economic environment for bricks and mortar British businesses and their families at the expense of the City of London’s financial skulduggery. Wake up. You are being manipulated.

girolamo: "…about to close a free trade deal with the whole of North America." The EU is not a free trade area, it is a highly regulated internal market. Any trade deal between the EU and the US will not be dependent on "ever closer union", nor on America's adoption of the Euro. Nor will the US be burdened with insane EU regulations. Try telling Americans that they can't refill their bottles with ketchup and they'd take you to court and spit out the bits.

scorpion_derooftrouser: And seizing people's assets is normal behaviour is it?