ITALY will today bring into force its tax on high-frequency trading, after introducing levies on certain equity derivatives earlier this year.
The Eurozone nation said in February that it will impose the financial transactions tax in stages, making it the first country in the currency bloc to use such a toll.
The high-frequency trading element of the tax was delayed over the summer amid uncertainty over which products would be affected, with some traders still in the dark about the scope of the new rules.
Analysts at Credit Suisse found that trading volumes fell by as much as 25 per cent following the launch of the first leg of the levy in March.
Italy has blazed a trail for the rest of the European Union, which intends to impose a Tobin tax on financial transactions next year.
The UK government has lobbied vociferously against the plan, while the International Monetary Fund has also expressed doubts.
“According to the IMF there are other levies that could be better than the Financial Transaction Tax,” Carlo Cottarelli, head of the IMF’s fiscal affairs division, said in July.
City A.M. Reporter