THE EU’S financial transaction tax (FTT) is based on false claims that much market activity has no value, a top business group said yesterday.
The Confederation of British Industry (CBI) told a committee of Lords that the European Commission has underestimated the damage its FTT will cause.
“There seems to be a philosophical underpinning to the tax – this is picked up in the impact assessment where lots of derivatives activity is assumed to have zero value,” said the CBI’s Richard Woolhouse. “And there are genuine questions about the extraterritorial impact of the tax.”
Meanwhile John Vella from the Oxford University centre for business said an FTT in 11 countries risks undermining plans for a global tax by pushing market activity to untaxed countries, building up opposition to the tax there.