The European Union has been trying to carry out the call for almost a decade Tobin Rate, although the debate has finally been limited to ten countries, among them Germany, France and Spain. The German finance minister, Olaf Scholz, tried to give a final push to the project with a proposal he sent last Monday to his counterparts. According to the German Ministry of Finance, the proposal goes through fixing a tax of 0.2% of the value of stock purchase operations of companies whose market capitalization exceeds 1,000 million euros.
Following the financial crisis, Brussels gave permission to 11 countries to coordinate to introduce that tribute. The first one tried failed, but in 2018 ten resumed the project: Germany, France, Belgium, Italy, Spain, Portugal, Greece, Austria, Slovakia and Slovenia. Estonia jumped from the list. In some, as in France, this tax already exists.
According to the German headline, last Monday he distributed to the ministers of those nine countries "a final proposal" for that rate. The offer comes just after the most leftist sector has been imposed within the German Social Democrats. That turn deprived Scholz of the leadership of the party, but also placed on the table of the Grand Coalition the demand to turn towards more progressive policies. In this case, Berlin expects to enter around 1.5 billion euros to finance the increase in minimum pensions.
Between 1.2 and 1.5 million beneficiaries in Germany
Germany plans to carry out this increase in the salaries of between 1.2 and 1.5 million pensioners in 2021. Hence the urgency that Scholz printed in his message to the other ministers to be able to prepare the land next year and obtain those funds. "We are, for the first time since 2011, in a position that allows us to reach an agreement within the enhanced cooperation," said Scholz's letter to his counterparts, according to France Presse.
The proposal has already sparked blisters within a sector of the CDU (center right), although German Chancellor Angela Merkel supported her whenever it comes to actions, as she said France and the United Kingdom are doing, according to Reuters. French Finance Minister Bruno Le Maire welcomed Scholz's proposal. "We will examine the text in detail to ensure that the final agreement is as ambitious as the French tax, already in force," he said. "But it is a good base to close this folder as soon as possible."
Scholz's proposal, community sources explain, includes exceptions to prevent German companies from having initial market access problems or to protect market liquidity. Even so, Germany's note indicates that the rate should contribute to “the financial system being more involved” with the needs of the community. In addition, the Ministry maintains that it also seeks to seek a “fair taxation” within the European financial system.
Spain is one of the ten countries that want to move forward with the creation of a share purchase fee. In fact, the Council of Ministers gave the green light to the bill for that new tax – along with the so-called Google rate -, with which it hoped to raise 850 million euros.
Its design was very similar to that of France and, therefore, to the proposal that Monday sent the German minister Olaf Scholz to his counterparts. Specifically, the Government wanted to tax with 0.2% the sale of shares of Spanish companies valued at more than 1,000 million euros. In that case, those responsible for sending that amount to the Treasury were the financial intermediaries.
The fate of the Spanish tax also bore similarities to the German: Berlin wants to allocate it to increase minimum pensions, while Madrid wanted to direct it to pensions and Social Security benefits. However, the April election call made the bill, along with the large technology tax, end up declining.
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