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The EU Member States will discuss the Tobin tax with Minister Vestager chairing the meeting

12-03-2012 09:51:00

Hungary and financial transactions are on the agenda when the EU's Ministers for Economic Affairs meet in the Ecofin Council Tuesday.

Photo: Council of the European Union
Ecofin council meeting

The Commission’s proposal to introduce a financial transactions tax will be discussed Tuesday when the Minister for Economic Affairs and Interior, Margrethe Vestager will lead her European colleagues through the third ECOFIN meeting during the Danish Presidency.

The 27 finance and economy ministers will consider a new recommendation for Hungary to improve their public finances and a suspension of commitments from the Cohesion Fund for Hungary. Furthermore, the ministers will discuss the Commission’s first Alert Mechanism Report.

When the 27 EU finance and economy ministers tomorrow sits down at the meeting table, they will among others discuss the Commission's much-discussed proposal to introduce a European Financial Transactions Tax - also known as a Tobin tax. The Danish Presidency has already had a number of technical discussions on the matter, which are yet to be completed.

Minister for Economic Affairs and the Interior, Margrethe Vestager says:

"The Danish Presidency is taking forward the discussion of the proposal to introduce a Financial Transactions Tax. In light of the request from a number of countries we have accelerated the work. Therefore, tomorrow all 27 countries will have the opportunity to express their position on the proposal and to provide input for the further work. I expect that the discussion will once again highlight the wide range of positions on the introduction of a Financial Transactions Tax. I do not expect that we will draw any final conclusions at this meeting but we will return to the matter at an ECOFIN meeting towards the end of the Danish Presidency. "

The ministers will also decide on a new recommendation for Hungary to get their public finances back on track and on a proposal to suspend commitments from the Cohesion Fund for Hungary as of 1 January 2013. Both decisions are in line with prior ECOFIN council decisions regarding Hungary’s failure to comply with its present recommendation. 

Margrethe Vestager says:

"The reason for the proposal to suspend funds is to give Hungary a strong incentive to implement the necessary budgetary improvements and ensure sound public finances. I believe that Hungary will now focus on getting back on track so that the suspension can be annulled before it even enters into force and Hungary will receive the funds as planned.”

At the meeting, there will also be a discussion of how to handle “macroeconomic imbalances” such as competiveness and balance-of-payments problems. The Commission’s so-called score-board report aims to identify countries that have or are at risk of building up macroeconomic imbalances. If further analysis shows that some countries have severe imbalances, the Council will at a later point during the Danish Presidency adopt recommendations for the concerned member states.

Watch livestream from the meeting

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