October 10, 2011
EU-tax discussed in the Swedish Parliaments’ European Committee
On Friday, September 30th, the European Committee of the Swedish Parliament discussed the EU Financial Transfer Tax (FTT). The liberal conservative Swedish government opposed the proposal and got support from the xenophobic Sweden Democrats. The Social Democrats, the Greens, and the Left Party were supportive of such a tax but under the condition that the EU will not be given the right to tax or the right to the income from such a tax.
Two Members of the European Parliament, Färm and Ludvigsson (S&D), have written about the advantages of the tax in a Swedish newspaper (Svenska Dagbladet), but they fail to mention that the tax will finance the EU’s heavily criticized agricultural policy, new EU bureaucrat jobs, expansion of EU policy areas, etc. Additionally, the European Commission and European Parliament would then get their hands on their own income resources and get their coveted opportunity to expand the EU budget year by year, because “greedy” member states would lose much of their ability to limit increases to the EU budget.
There are those that want the FTT independently of what it would finance, whether it will only be implemented in the EU, or if it would go into effect internationally (which is a separate debate concerning the negative consequences, such as the finance market moving to Switzerland if taxes increase in the EU).
Is the no line from the red, green, and opposition in Sweden really a no to EU tax, or will they be dribbled out of the game in the negotiation game in the Union? One scenario might be that the FTT becomes a reality, and, in return, the Commission promises to reduce membership fees for the member states. In the end, this would just be an illusion since the EU budget will continue to increase to the point that the membership fees will not have been reduced. Such a political ambush has been seen before when European Summits have promised to reduce EU membership fees which subsequently see an annual increase.
To circumvent already announced vetoes from member states against the FTT, there are rumours that the EU tax commissioner Semeta already has begun to work on a proposal to table FTT as a value added tax, which could be decided without unanimity and thereby bypass those member states that would have otherwise vetoed.
Again – the Commission has many cards up its sleeve to trick reluctant member states and national parties into a position where there will be a direct tax to finance the EU budget, whether they like it or not.
Jan Å Johansson