The proposal can partly be seen off by the UK, as any move will require unanimity among EU member states. But it is possible to agree on such a tax among a smaller group of EU states — a la Euro cooperation or Schengen — and that would still hurt the City. In EU jargon, the tax would be introduced under the so-called ‘enhanced cooperation procedure’ in the eurozone or amongst some other subset of member-States. This procedure requires at least nine EU states to participate. The decision to use enhanced cooperation is decided by QMV — qualified majority voting — among the
By way of a response, I've already suggested that the government should launch the biggest lobbying effort since Sebastian Coe orchestrated the London 2012 bid. We have friends in both France and Germany. The Nice-based EDHEC-Risk Institute has written to the Commission arguing that the tax ‘would be a counterproductive step for Europe’ and would face ‘serious implementation challenges’. In Germany, senior business leaders are said to be against the Tobin tax. The UK needs to build on this.
And, finally, the UK needs to push Michel Barnier, the ‘European Commissioner for Internal Market and Services’, to to get serious about liberalising the internal market. He — and his British chief official, Jonathan Faull — need to be told clearly that progress on liberalisation is the only standard upon which they, and the entire Commission, will be judged. That means, above all, pushing for the amendments to the Services Directive so that more content from the original proposal can be brought back rather than going on with the watered-down version on the books, which will achieve none of the growth-inducing effects that are so sorely needed.