MEPs want a Tobin tax

MEMBERS of the European Parliament have taken the extraordinary step of voting in favour of a Tobin tax on financial transactions.

The resolution was passed by 536 to 80 votes yesterday and the European Commission will now investigate a levy.

A financial transaction tax at the European level is still a long way down the line but the overwhelming support in Brussels is likely to send tremors through the City of London.

Those in favour believed it was the best way to tackle climate change, reducing poverty and cuts in public services.

Algirdas Semeta, EU taxation commissioner, added that it would help distribute wealth across Europe.

The Conservatives and British financiers said it would reduce the competitiveness of the European economy and increase the cost of raising capital.