Greece, which holds the EU’s rotating presidency until July 1, has proposed several options for taking the plan forward, according to the documents prepared for a May 28 working group meeting.
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“The problem with requiring the financial sector to participate in the costs is that the tax doesn’t necessarily impact those that are supposed to pay it,” Bundesbank President Jens Weidmann said yesterday. “It’s a fact that the transferral of the tax burden from the financial sector to its clients and therefore to the real economy and private investors is possible.”
The documents, obtained by Bloomberg News, lay out three paths for staking out the tax’s future after willing nations agree on an initial proposal. One would require the European Commission to offer a new proposal for any expansions, while another would be a review clause that would allow other products to be inserted. A third possibility would include other instruments from the start with “minimum zero rates” or later dates of entry into force, one of the documents shows.
Work also should focus on identifying which derivatives to include, the Greek presidency said. The commission’s original FTT plan offered a very broad definition of derivatives, starting with “options, futures, swaps, forward-rate agreements and any other derivative contracts relating to securities, currencies, interest rates or yields, or other derivatives instruments, financial indices or financial measures which may be settled physically or in cash,” one of the documents says.