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UK braced for EU ruling on financial transactions tax

The UK is braced for a ruling next week on the financial transaction tax proposed by the EU.

The Financial Times reports the European Court of Justice has unexpectedly accelerated its decision on a British legal challenge to the tax and will announce its judgment next Wednesday. A decision had not been expected until next year.

Germany, France and Italy have led the charge by 11 EU countries to introduce the tax on all financial transactions.

But UK banks and financial services firms have lobbied hard against the change, arguing it would hit UK jobs and increase prices on consumer products.

Last year the UK launched a legal challenge against the proposals.

Think-tank Open Europe says the rapid progress in the case bodes ill for Britain’s prospects, according to the FT.

It says there is now an 80-90 per cent chance the UK’s challenge will be thrown out.

But a spokesman for Chancellor George Osborne says the Treasury could launch further legal action if it were to lose the case.

The spokesman says: “We are confident we will be able to get an outcome which would protect the single market and non-participating member states.”

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