Financial Transaction Tax – still a cause for concern?
The FTT was due to take effect from 1 January 2014. In June the European Commission quietly announced a delay of at least 6 months.
As we approach the end of the year there must be real doubt as to whether an FTT, in a form bearing any resemblance to that proposed so far, will ever be introduced. As seen from my earlier post insurers and reinsurers would be affected by such an FTT.
The status of the FTT is uncertain, to say the least.
In September, the EU's own lawyers published a legal opinion stating that the FTT in its proposed form would be illegal. Although the legal opinion is non-binding, meaning that the 11 participating Member States could still press ahead with the FTT, this was seen by many observers as the beginning of the end for the FTT.
However, the new German coalition government has reaffirmed Germany's commitment to the FTT, and a recent leaked report suggests that the European Commission's lawyers are challenging the findings of the September legal opinion. The UK governments own legal challenge, before the ECJ, remains in place.
As a result, it remains a case of watch this space …