Exchanges ring alarm bells over EU transaction tax
By Huw Jones
LONDON (Reuters) - Top exchange officials opposed to a European financial transactions tax intensified their lobbying on Tuesday, warning it would push trading to other parts of the world and make it harder for companies to raise funds.
Eleven countries from the European Union are examining a plan to tax their stock, bond and derivatives trades from January 2014, no matter where they happen in the world.
The aim is to raise up to 35 billion euros a year to make banks pay for the help received in the financial crisis.
The United States opposes the levy, fearing New York will be hit, while Britain, worried about its impact on London, the EU's biggest trading center, has challenged the plan at the European Court of Justice.
Another EU member, Luxembourg, wants the tax reined back.
Mark Hemsley, chief executive of London-based BATS Chi-X Europe, one of the region's pan-European stock exchanges, said much financial regulation was politicized.
"The number one example of that is the financial transaction tax which in the end will be extremely harmful for Europe, especially if it stretches into extra-territoriality and becomes the next trade war, as it were," Hemsley told a CityWeek conference on Tuesday.
"The extra-territorial ramifications are absolutely alarming," added Janet Ecker, president of the Toronto Financial Services Alliance, which promotes the Canadian city as a financial center. Continued...