09/01/2012
French financial association opposes Tobin tax on France alone
The Paris Europlace association, which promotes and develops the Paris financial market, has declared its opposition to the establishment of a tax on financial transactions if it is not applied throughout Europe. A tax which would specifically sanction the French financial sector would be inappropriate, the association claimed on Friday, 6 January, pointing out the limitations and risks of such an initiative.Though the law would aim to combat financial speculation, its overly broad application would affect transactions made by private investors, businesses and institutional investors, and would cause significant risk distortions. Its cost would also penalise French banks, asset management firms and insurers, and toughen borrowing conditions for businesses throughout the French economy. It would also lead to substantial losses for the Paris financial industry, and that would come in addition to the already high cost of new financial regulations being put in place (Based 3, Solvency 2), a statement from Paris Europlace claims.The association of financial sector businesses and their retail and business clients claims that they would be at a disadvantage of the plans are put into action. If the law were applied only in France, it would inevitably lead to “a delocalisation of the activities concerned at banks, insurance companies and asset management firms, in favour of the major global financial centres, and would consequently reduce control of financing conditions in our economy and the role of the Paris market in the European and global economies,” the association claims.
