France, Germany, Austria, Belgium, Slovenia and Portugal officially requested the European Commission to make a proposal to Council to authorise a limited number of member states to launch enhanced cooperation for a common system of financial transaction tax (FTT). Under the EU Treaties, at least nine requests from Member States must be made to authorise the start of “enhanced cooperation”, which allows a smaller group of Member States to move ahead on a Commission proposal without all 27 being on board.

A unanimous decision could not be reached on the proposal for a directive on a common system of FTT at the ECOFIN Council meetings on 22 June and 10 July 2012. On this basis, Member States such as France and Germany proposed to proceed with the introduction of a FTT under a system of enhanced cooperation but have also called upon the Commission to conduct an assessment of the economic impact a system of enhanced cooperation may have on matters such as distortions and transfers to other jurisdictions.

A copy of France and Germany's letter to the Commission is available on the Chartered Accountants Ireland website www.charteredaccountants.ie