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18th January 2012 | Uncategorised

Taoiseach was too hasty in ruling out transaction tax

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Taoiseach too hasty in locking Ireland into UK position on transaction tax

 

As Greens advise the Finance Minister to take a different tack in his talks today with his German colleague.

 

Green Party Finance Spokesperson Mark Deary said today, “The Taoiseach was far too hasty in locking Ireland into the British position on the transaction tax, following his meeting with David Cameron last week.  Having said so little on the night in December when Britain was allowed to become isolated from the rest of Europe, our Taoiseach seems to be going to the other extreme by threatening an immediate veto on the proposed tax.”

 

“The problem is that he has decided to hitch our wagon onto opposition to a sensible measure that should be in our national interest.   The transaction tax would rectify one of the main causes of the economic crisis and could be done in a way which does not threaten jobs in the IFSC.”

 

“According to the Impact Assessment carried out by the European Commission, a tax on activities such as high volume automated secondary trades will accrue many financial, structural and social benefits. The government should conduct its own impact assessment on the  Financial Transaction Tax Directive, taking account of the full cost of weaker regulation to this country and then to make a decision on where our long term interests lie.”

 

“The Green Party have long supported the introduction of such a charge which would not deter genuine trading activity but it would act as a deterrent to the sort of speculative casino betting on the financial markets that got the world economy into such trouble.  Given that we will have to raise tax revenue it is better to do so on activity that we want to discourage rather than always hitting the general public.”

 

“The charge would not impact on Central Bank activities, mortgages or the primary markets but it would add to the cost of speculating on securitised products and change investor behaviour in favour of the cash starved productive economy.  It is planned that the revenues raised would be for use within the European Union, in part replacing national contributions to the EU, and will be collected on the basis of where institutions operate from. This could be advantageous to Ireland and would ultimately mean that the industry that caused the ruinous collapse finally begins to pay for it?”

 

“With all this to gain, the Minister of Finance should engage more proactively with the German Finance Minister who he meets today and put the transaction tax issue into the mix of measures we are going to have to get agreement on to get our economy back in shape.”

ENDS