Starting a new business? Get 40% off our accountancy services for 3 months! 😀

x

Speaking from experience Anders Borg, Sweden’s finance minister, has advised that a European financial transaction tax, as proposed by the European Commission, would prove problematic for Europe as, rather than bring in the additional revenue that has been projected, it would cause firms to move outside of Europe.

In the 1980s, Sweden imposed a financial transaction tax on firms and the results were undesirable. According to Mr Borg, over 90% of Sweden’s equity, bonds and derivative traders moved from it’s capital to London. This resulted in huge losses in tax revenue and the eventual scrapping of the transaction tax.

Mr Borg fears that if the tax is introduced to Europe there will be a similar result. There are concerns that, as the US and Asia will not consider imposing the tax, firms will have the opportunity to move away from Europe which in all liklihood will be the favourable option to them.

The UK has opposed the tax as it is believed it would not be in the UK’s best interests as most European banking transactions come through London, and therefore the UK will oppose any tax that is not introduced worldwide.

In contrast, several European countries have expressed their support for the tax including Spain, France and Norway as well as Austria and Belgium. Due to the divided opinion within Europe, the commission has stated that it will consider introducing the tax solely to eurozone members.

If the tax was approved and implemented it would mean that any transactions between banks, whereby at least one was based in Europe, would be taxed at 0.1%. It is predicted that this would bring an additional 57Bn euros into Europe each year.

About The Author

Lee Murphy

MAAT and ICPA accountant, with a passion for making accountancy and bookkeeping accessible. Other interests include cloud-based software development for web and mobile access, keeping fit, reading, and entrepreneurship.

More posts by this author
guest
0 Comments
Inline Feedbacks
View all comments

Read more posts...

Umbrella Companies for Self-Employed Contractors

When you set up in business as a contractor you might either work as a sole trader or as a limited company….

Read More

Get Ready for Small Business Saturday UK 2022

Small Business Saturday started in the US in 2010, on the first Saturday following Thanksgiving. It aims to encourage shoppers to consider…

Read More

Architects and Tax

Architecture is a highly diverse sector when it comes to tax. It’s partly down to the type of businesses that carry out…

Read More
Back to Blog...

Confirm Transactions

The number of monthly transactions you have entered based on your turnover seem high. A transaction is one bookkeeping entry such as a sale, purchase, payment or receipt. Are you sure this is correct?

Yes, submit my quote
No, let me change it

Please contact our sales team if you’re unsure

VAT Returns

It is unlikely you will need this service, unless you are voluntarily registered for VAT.

Are you sure this is correct?

Yes, the business is VAT registered
No, let me change it

Call us on 020 3355 4047 if you’re not sure.

Bookkeeping

You only need this service if you want us to complete the bookkeeping on your behalf.

Would you prefer to complete your own bookkeeping?

Yes
No

Call us on 020 3355 4047 if you’re not sure.