New tax introduction threatens French banks

11.01.2012

In 2011 the plan to introduce a new tax on financial transactions was one of the European Commission projects. This mandatory payment is supposed to be collected from all the transactions with shares and bonds between financial institutions, at least one side of such transactions must be in the EU. According to the EC project such transactions are taxed at a rate 0.1%. This mandatory payment does not apply to transactions in the foreign exchange market. However, despite this fact, the mentioned tax will affect up to 85% of transactions between financial institutions.

At the beginning of January 2012 French President Nicolas Sarkozy during official meeting with German Chancellor Angela Merkel announced the intention to introduce a tax on financial transactions according to the existing EC project. This statement was not supported by the French Federation of Banks that believes that this innovation will be an obstacle for the entire French economics.

Expert’s opinion

“Today France like many other European countries is trying to find new sources of state budget revenue. This time, the government plans to introduce a tax on financial transactions at a rate 0.1%. It’s obviously that for French banks such innovation will be a serious obstacle for the implementation of the relevant transactions. It’s most likely that the country's financial institutions will be forced to transfer most of the transactions abroad”.

On the basis: www.expert.ru

Andrianova Irina ( the leading lawyer of legal support and banking consulting department of Honest&Bright)