April 6, 2010 April 15-17 ~ EU Finance Ministers To Discuss Revenue Raisers At Madrid Meeting
BRUSSELS (MNI) – European Union finance ministers will discuss new ways of raising revenue – including financial sector levies and carbon taxes – to plug their budget deficits when they meeting informally in Madrid April 15-17, the European Commission said Tuesday.
The ministers will discuss a working document, prepared by the EU’s executive arm, which outlines several new ways of raising revenue, the Commission said.
Governments increased spending during the financial crisis to try an ward off the worst of the recession. Tax income also fell during that period, leaving most EU countries with large budget deficits which have been the subject of increasing concern in recent months, particularly in light of the Greek debt crisis.
The Commission said its analysis “shows that there are some instruments, notably certain forms of contributions from the financial system and the pricing of carbon emissions, with which a significant ‘double dividend’ of both raising revenues and improving market efficiency and stability could be reaped.”
It said that “schemes aimed at pricing leverage and risk-taking in the financial sector could raise substantial revenues while limiting undesirable behaviour by financial institutions and could be administered at a reasonable cost.”
“The idea is to get some common ideas, common guidelines at the European level,” ahead of the Group of 20 meeting, Commission spokesperson Amelia Torres said. She said the International Monetary Fund was working on similar ideas and would also produce a paper.
The Commission document said the schemes it was proposing “would benefit from an internationally coordinated approach, in particular within the G-20,” but that an EU solution could be explored if that wasn’t possible.
BRUSSELS (MNI) – European Union finance ministers will discuss new ways of raising revenue – including financial sector levies and carbon taxes – to plug their budget deficits when they meeting informally in Madrid April 15-17, the European Commission said Tuesday.
The ministers will discuss a working document, prepared by the EU’s executive arm, which outlines several new ways of raising revenue, the Commission said.
Governments increased spending during the financial crisis to try an ward off the worst of the recession. Tax income also fell during that period, leaving most EU countries with large budget deficits which have been the subject of increasing concern in recent months, particularly in light of the Greek debt crisis.
The Commission said its analysis “shows that there are some instruments, notably certain forms of contributions from the financial system and the pricing of carbon emissions, with which a significant ‘double dividend’ of both raising revenues and improving market efficiency and stability could be reaped.”
It said that “schemes aimed at pricing leverage and risk-taking in the financial sector could raise substantial revenues while limiting undesirable behaviour by financial institutions and could be administered at a reasonable cost.”
“The idea is to get some common ideas, common guidelines at the European level,” ahead of the Group of 20 meeting, Commission spokesperson Amelia Torres said. She said the International Monetary Fund was working on similar ideas and would also produce a paper.
The Commission document said the schemes it was proposing “would benefit from an internationally coordinated approach, in particular within the G-20,” but that an EU solution could be explored if that wasn’t possible.
Spanish Finance Minister Elena Salgado, the current Ecofin president, will raise the issue at an informal meeting of finance ministers in Madrid on 15-17 April. Before that, the EU's Economic and Financial Committee (EFC), which brings together high-level officials from national finance ministries, will discuss possible courses of action.
“We will take initiatives and make sure that there will be further technical discussions in the EFC on this issue, and then it will come back to the Ecofin,” Borg said.
