Towards a Financial Transaction Tax? Interview with Philippe Lamberts

European Green Party: In essence, what is the "Financial Transaction Tax" (FTT)? Why is it important?

Lamberts: The FTT is a small levy on financial transactions such as shares, bonds and derivatives, securities, etc.
Due to a lack of unanimous support for an EU-wide FTT, 11 Member States were authorized in December 2012 to take forward an FTT under the enhanced cooperation. They are expected to come to an agreement today.

EGP: Some media outlets called this tax a "Robin Hood tax". What is the Green perspective on it?

Lamberts: The term "Robin Hood tax" refers to one of the main goals of the FTT, which is to combat growing social inequalities by creating a system of fairer and equitable tax collection. Taxing financial transactions makes sense as those who hold financial assets have been amassing huge fortunes which are screaming out to be reinvested in the real economy. But, the FTT pursues another objective: curbing speculative short-term and high-frequency trading.

EGP: The Economic and Financial Affairs Council is discussing today the state of play of the proposal for a directive on the FTT. What are the issues at stake and the main challenges regarding this procedure?

Lamberts: One of the main challenges is to ensure a broad scope for the future FTT - with as little exemptions as possible - in order to prevent banks and other financial institutions from using tricks to avoid paying it. Member States also need to agree on the rate to tax these financial transactions and on additional implementation modalities. Finally, Member States need to ensure these funds will be used for common public goods.

EGP: In 2013, the newspaper 'Le Monde' called you "l'homme le plus détesté par la City" because of the proposal on capping bankers' bonuses. Is this issue (back then) and the FTT (today) part of the same picture?

Lamberts: Both measures share a common goal: curbing the logic of short-term profitability that is still driving the financial system.

By: European Green Party