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EU may propose 'Tobin' tax for 2014

German Finance Minister Wolfgang Schaeuble

EUROPEAN Union regulators may propose a levy on financial transactions under the EU budget, beginning in 2014, to diversify sources of revenue.

"It's one of the options," David Boublil, tax spokesman of the European Commission, the 27-nation EU's regulatory arm in Brussels, said yesterday. "It's not decided yet."

The commission intends this week to propose the EU's spending programme for the seven years starting in 2014.

National governments finance 70pc of the EU budget, leading the commission to seek ways of diversifying sources of revenue. The spending ceiling for the EU in 2007-2013 totals €864bn, or around 1pc of the region's gross domestic product.

Any proposal for a financial-transaction tax in the 2014-2020 budget would need the unanimous support of EU governments, Mr Boublil said.

Such a levy is sometimes called a Tobin tax after James Tobin, the Nobel Prize-winning economist who first suggested the idea in 1971.

Meanwhile, German Finance Minister Wolfgang Schaeuble used a newspaper interview yesterday to warn against "over-inflated expectations" of tax cuts, his spokesman said. Finance ministry spokesman Martin Kreienbaum made his comments in Berlin.

German Finance Minister Wolfgang Schaeuble

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