Just as the dust was settling after David Cameron exercised the UK veto to prevent deeper EU integration via treaty changes, the French minister for Europe has declared that a Tobin tax will be applied across the Union despite UK opposition.
Jean Leonetti has stated that the Germans and French have already ‘decided’ to introduce the tax on financial transactions, which would hit the City of London.
This has raised the prospect of David Cameron having to once again wield the UK veto to prevent billions being transferred into the EU coffers on an annual basis to prop up their failed political project called the Euro.
Mr Leonetti though insists that “This is on the programme for the next European summit. Nicolas Sarkozy and Angela Merkel have decided on this and it will be put in place before the end of 2012”. Although previously the tax had been proposed for 2013.
At present national governments decide tax, the EU can only monitor them to see that they are fair to the EU when taken as a whole. The EU can take no decision to raise tax unless all member states agree to do so unanimously. But over time the EU is aiming to remove that veto moving tax into the qualified majority voting category putting the UK’s ability to set its own tax rates at risk.
UKIP leader and MEP Nigel Farage said “It comes as no surprise that France and Germany are in full agreement on this tax. Why wouldn’t they agree to raid Britain to fund their own failures? David Cameron has to block this proposal. It is not in Britain’s interests; it will be immensely damaging.”
Conservative MP Douglas Carswell said “The sad reality we have to face is that Europe will eventually be able to ride roughshod over our opposition to this tax. This shows why we need to leave the EU. If this is what our masters in Europe have in store for us, then we are better off out.”
One proposal the EU is looking into is to impose a 0.1% levy on share transactions and a 0.01% levy on other financial instrument transactions. This it is thought could raise some Â£45 billion a year for the Brussels coffers. Much of this would of course come from the City, possibly then driving business into the arms of exchanges in New York, Zurich and Hong Kong.
If a tax is to be raised in the UK it is for HM Government to decide how much and how it is to be raised. It would also then decide on where that money would be spent. If a Tobin Tax is to be introduced in the UK it should be on that basis and that basis alone.
The EU recently gave itself a 2% budget increase having cheekily demanded about 5% while all around were facing huge cuts and austerity. Now it seems to want to fill the gap from another source and what better way than to start raising its own taxes. First a Tobin tax then more general taxation for the EU, not national politicians, Â to decide what to do with it.
When is the UK going to wake up and realise this is one club we can do without being a member of?