Pátek 29. března 2024, svátek má Taťána
130 let

Lidovky.cz

Czech FinMin slams Barosso’s tax plan as populism

Evropa

  18:03

Czech finance minister dismisses Barroso’s financial transaction tax proposal as ‘populism’ for which EU consumers would pay the price  

Nečas and Kalousek (right) both served at the MoD in the mid ‘90s foto: ČTKČeská pozice

Czech Finance Minister Miroslav Kalousek (TOP 09) lambasted the proposal put forward on Wednesday by José Manuel Barroso, president of the European Commission, to introduce a European-wide tax on all financial transactions. Kalousek described Barroso’s call for banks and financial institutions to be made to pay back their debt to the taxpayers as “beautiful populism.”

“From the point of view of competitiveness of the European economic space, the idea to tax financial transactions is the very worst idea possible,” Kalousek said in an interview with Rádio Česko on Thursday morning. “If financial transactions are taxed in this [European] space, nothing will happen other than the great majority [of financial institutions] moving out of the European economic space where they won’t be taxed,” he added.

Taxpayers would pay

According to Kalousek, politicians in the EU who claim the tax would force banks to pay back public funds used to bail them out during the financial crisis are not telling the truth: “It would be the logical consequence that the transactions that would be conducted here [in the EU] and taxed here, the [expense of the tax] would fall nobody else other than the end consumers,” he said.

As for the proposal to levy a financial transaction tax globally, Kalousek said he had discussed the matter with counterparts from other EU states and G20, but said the idea is “absurd” because global agreement would never be reached.         

In an interview with the news channel ČT24 later in the day, Raiffeisenbank economist Pavel Mertlík supported the Czech finance minister’s stance and pointed to the example of Sweden, which in the late 1980s introduced 0.1 percent tax on bond transactions, and a 0.01 percent tax on derivatives transactions. “Within a very short space of time the number of bond transactions fell by 85 percent, and trades in derivatives – by 92 percent. That market completely collapsed and the Swedish government abolished the tax within a year,” Mertlík said.

Kalousek as UK’s advocate        

The main center-left opposition Social Democrats (ČSSD) called a press conference Thursday at which party representatives called upon the government to reconsider its opposition to Barroso’s tax proposal and calls for uniting the EU’s economic policy, which would require amendments to the Lisbon Treaty.

“The government should stop protecting foreign interests and begin defending those of the Czech Republic. …In all 64 percent of that tax would be collected in Great Britain, whereas in the Czech Republic it would be on the level of a statistical error. This is because the Czech Republic has an economy based not on financial transactions, but on the real economy, manufacturing industries,” shadow finance minister, Jan Mládek, said.                   

Barroso claims the tax would raise around €55 billion a year.  In addition to the arguments expressed by Kalousek, Czech Prime Minister Petr Nečas (Civic Democrats,ODS) said he opposes Barroso’s proposed tax as it would set a precedent as the first direct EU tax.

Autor: