03 February 2012

English Channel Widens

The President of France, Nicolas Sarkozy, this week announced plans for a 0.1% levy on financial transactions, to be implemented in that country through its exchanges in August regardless of whether any other European countries do likewise.

According to the BBC News, details of Sarkozy's plan remain sketchy, but it is to be implemented in August, and will be especially oriented toward taxing equity transactions.

Of course the British Prime Minister, David Cameron, has been outspokenly against any sort of transactions tax that would impact London, and indeed Cameron said on Jan. 26 that any EU provision to that effect would be "madness."

This is not especially a marker of Cameron's Tory loyalties. I don't see how any British PM could take a different stance. London is not only Europe's great financial center, it is one of the handful of leading centers in the world.

Back at home ... Sarkozy faces an election campaign in the coming months. His rival there, Socialist candidate Francois Hollande, has also promised a tax on financial transactions, so Sarkozy may be engaged in a thunder-stealing gambit here, one of those Nixon-goes-to-China things.

One final point: none of this has much to do with the currency-oriented transactions tax once advocated by James Tobin, although the phrase "Tobin tax" is used quite promiscuously these days.

1 comment:

Blogger said...

eToro is the most recommended forex broker for newbie and established traders.

Knowledge is warranted belief -- it is the body of belief that we build up because, while living in this world, we've developed good reasons for believing it. What we know, then, is what works -- and it is, necessarily, what has worked for us, each of us individually, as a first approximation. For my other blog, on the struggles for control in the corporate suites, see www.proxypartisans.blogspot.com.