Bloomberg News

Barnier Says Bank Transaction Tax ‘Economically Bearable’

December 01, 2011

Dec. 1 (Bloomberg) -- European Union Financial Services Commissioner Michel Barnier said his proposal for a tax on financial transactions is “economically bearable” and a small price for banks to pay given the government support they have received.

The plans for the so-called Tobin tax are “technically easy to implement, economically bearable, financially productive and politically just,” he said today in Valletta, Malta, where he met with Finance Minister Tonio Fenech. Malta, like the U.K., opposes the tax because the government believes it would put the country’s growing financial services at a competitive disadvantage.

The financial industry should be prepared to “give back” something to Europe, after so much had been done to protect financial services companies, Barnier said.

He also defended the euro and rejected what he called “a catastrophic and fatalistic” view of the euro-region crisis. The euro was a solid currency and not at risk, he said.

“It is a question of determination to implement what heads of government agreed upon in October, and each country must work at home to manage its budget properly and reduce sovereign debt,” Barnier said. “One for all and all for one” should be the philosophy of every EU and euro-zone member state, Barnier said.

--Editors: Andrew Davis, Andrew Atkinson

To contact the reporters on this story: Karl Stagno-Navarra at ksnavarra@bloomberg.net

To contact the editor responsible for this story: Andrew Davis in Rome at abdavis@bloomberg.net


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