Fear transaction levy will cut tax revenues

The proposed European transaction tax suggested by the European Commission in 2011 could end up cutting overall tax revenues rather than generating extra funds, according to a new study issued in January 2012.

Under the European Commission’s own assessment of the impact of the tax, more than two-thirds of the expected €37bn to be raised from the tax would be eaten up by a hit to economic growth, argued the report from Oxera, an Oxford-based economic consultancy.

ESO: Background information: Sarkozy says France must lead on transactions tax http://www.europeansources.info/record/sarkozy-says-france-must-lead-on-transactions-tax/

ESO: Background information: Barroso backs transactions tax http://www.europeansources.info/record/barroso-backs-transactions-tax/

European Commission; DG Taxation and Customs Union; Taxation: Other taxes: Financial Sector: Taxation of the financial sector http://ec.europa.eu/taxation_customs/taxation/other_taxes/financial_sector/index_en.htm

Oxera: Press Release, 10.1.12: Oxera reviews the European Commission’s economic impact assessment of the proposed financial transaction tax http://www.oxera.com/main.aspx?id=10181

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