EUROPEAN UNION: EFAMA Releases Opinion on Proposed New Financial Transaction Tax and its Impact on UCITS

Thursday March 14 2013

On 14 March 2013, EFAMA released a statement with regard to the proposed ‘new’ Financial Transaction Tax (FTT). It believes that the ‘new’ proposal for a Council Directive implementing a FTT in just 11 Member States (FTT-zone) means that EU savers in UCITS will pay EUR 13 billion of FTT annually.

Furthermore, EFAMA believe that the FTT will have a highly detrimental impact on a wide range of activities (in particular in the area of money market funds, repos, securities lending), which will reduce liquidity in the financial market, increase the cost of capital for European companies and drastically reduce the attractiveness of saving through funds and pension plans.

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