Just as the EU dropped plans to tax the life out of tech giants, France reopens such plans, echoing the Tobin Tax. A combination of financial transaction taxes and technology tax demonstrate’s Europe’s disdain for FinTech and capital markets and why other markets are the future.
For many brokerages which have had to contend with repressive rulings that have attacked the FX and CFD business over the last year, European officials are now a step closer to formalizing another initiative which should send an even clearer message that Europe is no place to do business.
A sigh of relief may well have been breathed by most financial markets participants earlier this month when European Union-wide proposals to impose draconian taxation on technology and internet giants such as Amazon were abandoned, however France has not taken this lying down and is now looking to instigate national tax levies on large technology companies.
Mainland Europe’s floundering economy, widespread unemployment and regressive approach to modernization and technological innovation has rendered the entire continent dependent on London, hence the European Parliament’s zealous attempts to prevent Britain leaving the European Union without a very watered down version of “Brexit” whose sole intention is to keep the gravy train flowing from London’s efficient capital markets powerhouse into the coffers of the derelict EU economy.
French finance minister Bruno Le Maire said he would push ahead with the tax plans after talks to establish an EU-wide version collapsed earlier this month. “The tax will be introduced whatever happens on January 1 and it will be for the whole of 2019 for an amount that we estimate at €500m,” Le Maire explained to French press.
This echos the equally unfriendly Tobin Tax which now blights many European nations and has done as much to alienate the modern and innovative investment platforms as Singapore has done to attract them.
The Tobin tax, which would apply to derivatives and bonds, has been fiercely opposed by UK officials and politicians in recent years. It was originally proposed to target the FX market when it was orchestrated by James Tobin in the 1970s, and whilst Britain has managed to remain free from it’s burden until now, Jeremy Corbyn is a staunch advocate of implementing it.
Just four years ago, there was a substantial amount of discourse mounting in London with regard to the European Union’s predilection for the intrinsically socialist Tobin Tax on transactions that are placed in trading financial instruments.
That has now gone completely quiet, as Britain opposed it on principle and has managed to fend it off, however in 2013, eleven European Union member states, all of which were led by left-wing governments, announced their wish to move ahead with introducing a financial transactions tax.
At that time, the nations – which include France and Germany – intended to use the tax to help raise funds to tackle the debt crisis, and the tax had the backing of the European Commission which was reinforced after the 2014 election the highly unpopular Jean-Claude Juncker as President.
The other countries that wished to introduce it were Italy, Spain, Austria, Belgium, Greece, Portugal, Slovakia, Slovenia and Estonia, all nations with absolutely no place in the world’s highly advanced financial markets economy. Greece’s government accountants, when not asleep for half of the day, cannot tell the top from the bottom of their balance sheets, Italy is rife with corruption, Portugal is agrarian, Belgium has invoked outright bans of retail electronic trading instruments and Slovakia, Slovenia and Estonia have absolutely no Tier 1 bank presence.
The technology tax, which France is looking upon as eagerly as it did the Tobin Tax as a counterproductive and anti-capitalist method of raising money for the government’s bloated coffers,
has been blasted by free market nations for considering it.
In July US President Donald Trump said: “I told you so! The European Union just slapped a $5bn fine on one of our great companies, Google. They truly have taken advantage of the US, but not for long!” France argues that the tax is needed to ensure that the tech giants do not route their revenues through tax havens and avoid paying their fair share to the European taxman.
The reality is that most of Europe has become so unfriendly toward modern business and so much in favor of old fashioned socialism and protectionism that it does not matter one jot what restrictions apply within the MiFID rulings, as very little electronic trading business will be relevant in Europe soon. Instead, Singapore, Hong Kong, Australia, an independent Britain and a growing North American derivatives sector along with emerging and well organized markets such as South Africa will become the focus for basing operations and client bases in business-friendly and economically hard-working regions in Asia, America and the Far East will increase.
One only has to look at the successful businesses being operated in Australia in the retail sector whose business is booming due to a combination of sensible regulation by ASIC, good quality leadership, Australia’s excellent provision of a quality business environment and the quality regions in the APAC region as retail and commercial partners compared to the floundering results experienced by those attempting to onboard mainland European client bases.