Main focus of Monday, January 9, 2012

Europe divided over Tobin tax

Sarkozy is considering introducing his financial market tax as early as January. (© dapd)

French President Nicolas Sarkozy sparked a debate over the financial transaction tax when he announced on Friday that he would introduce the Tobin tax unilaterally if necessary. On Sunday the UK said it would not levy the tax unless if was introduced globally. The press writes that introducing the tax in a single country makes no sense and is merely an electoral tactic, although Cameron's stubborn refusal could cost Europeans dearly.

Frankfurter Allgemeine Zeitung - Germany

The announcement by France that it may unilaterally introduce a financial transaction tax in January is clearly an election tactic, the conservative daily Frankfurter Allgemeine Zeitung concludes: "French President Nicolas Sarkozy ... is in a hurry to introduce the financial transaction tax because he has realised shortly before the presidential elections how little his grandiloquent speeches about taking action against banks and financial market speculations have been backed up by facts. Yet the introduction of such a tax - especially in just one country - would be economic nonsense. The French banks can easily transfer their trade to nearby London or Frankfurt. So if France does press ahead with the tax the rate would be so low that it would be barely noticeable for market players, turning the tax into an empty shell robbed of all purpose. Unfortunately we have become only too familiar with such ploys in the Sarkozy era. Politics is reduced to a game of symbolic gestures." (09/01/2012)

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La Stampa - Italy

British Prime Minister David Cameron on Sunday reiterated his rejection of a European financial transaction tax as long as it is not introduced globally. This stance could cost Europe and its citizens billions in revenues, the liberal daily La Stampa contends: "He destroys every glimmer of hope. David Cameron deliberately ignores any invitation to participate in constructive dialogue. He sticks doggedly to the Thatcher script of defending the City. This line may be coherent, but the timing is bad. French President Nicolas Sarkozy is visiting German Chancellor Angela Merkel this Monday morning to discuss the conditions for the envisaged fiscal union. ... Cameron's Thatcher stance is hardening apace with the German-French stance, which will hopefully receive support from Italy and Europe. Because the tax could channel revenues of over 50 billion euros into the state coffers, to the advantage of the citizens." (09/01/2012)

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Le Temps - Switzerland

Sarkozy's sudden commitment to the financial transaction tax comes as a complete surprise to the liberal daily Le Temps: "Having fiercely opposed any taxation whatsoever of financial transactions just a few years ago, the French President Nicolas Sarkozy has now become the staunch advocate of a tax with a strange history. The brain child of the liberal economist James Tobin, popularised by the antiglobalists, defended and then put on ice by the socialists and put on the agenda of liberal governments and the G20 in London in 2009, this tax has been officially discussed in Brussels since June 2011. ... Even if the state coffers are empty, this old idea of a tax on financial transactions will drive the price of capital even higher and is not the solution to Europe's problems or the world's. Especially in the absence of coordinated, collective action." (09/01/2012)

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