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Olaf Scholz: Austria rejects plan for financial transaction tax


Finance minister Olaf Scholz has to revise his draft for a European tax on share transactions. Criticism of his proposal also comes from the Left Party.

Federal Finance Minister Olaf Scholz has to change his plans for taxing stock exchange transactions - and thus for financing the basic pension. Austria urged significant changes after a meeting of EU finance ministers and threatened to exit the project. The plan was "not acceptable," said Austrian Finance Minister Gernot Blümel in Brussels. "This would punish the real economy and small investors and indirectly reward speculators." Blümel therefore asked Scholz for a new proposal.

A tax on stock transactions and financial products has been discussed in the EU for years. It was originally planned to help banks share in the cost of tax bailouts in the financial crisis and to slow speculators. However, this idea failed in 2013 at least in an EU-wide form. A group of ten countries is currently trying to implement the so-called enhanced cooperation project. In addition to Germany and Austria, Belgium, Greece, Spain, France, Italy, Portugal, Slovenia and Slovakia are also to participate.

Austria threatens to exit

Last year, Scholz submitted a proposal for the new financial tax. According to this, share transactions should be taxed at a rate of 0.2 percent and only apply to paper issued by companies worth more than one billion euros. In Germany there are 145 companies, in the ten states more than 500. The Federal Minister of Finance is expecting revenues of 1.5 billion euros, which Scholz intends to use to finance the basic pension.

Blümel now called for the EU Commission's original proposal from 2013 to be taken up again. At that time, the authority had proposed that a 0.1 percent levy be levied on transactions in stocks and bonds. The rate for trading complex financial products, so-called derivatives, should be 0.01 percent. Austria wanted a "common, broad-based financial transaction tax," said Blümel. Scholz 'draft would not include "the lion's share of financial transactions". If Scholz did not change his plans, the government in Vienna would no longer participate. "I shared that with Olaf Scholz."

"The proposal does more harm than good"

The Federal Minister of Finance continues to see an agreement as possible, but did not specify a time frame for this. "Europe has never been this far ahead," said Scholz. He felt supported by many countries, and the talks with the new Austrian government were also friendly. He therefore continues to expect a result based on his proposal, which takes into account "what is politically possible".

Resistance also comes from Scholz's coalition partner CDU. The plans damaged the stock culture in Europe and Germany, warned the CDU economic council. Secretary-General Wolfgang Steiger, like the Austrian Minister of Finance, argued: "The way the financial transaction tax is structured now is purely a share tax that burdens the only remaining profitable pension option in the low-interest phase." Left-wing politician Fabio De Masi also said: "Austria is right. Olaf Scholz's proposal for a share tax does more harm than good and takes responsibility for the causes of financial crises."

Source: zeit

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