EU should 'coordinate' Tobin tax ideas: Commission

(BRUSSELS) - European nations should use a tax on financial transactions to boost their income, European Commission policymakers argue in a report on economic strategy for the next decade.

"New tax bases, eg financial transactions, should be explored, in a coordinated way, as potential sources of government revenues," according to the European Commission's "2020" vision, seen by AFP and due to be published on March 3.

Post-economic crisis moves to tax the finance industry have moved higher up the political agenda but still divide European Union leaders, while efforts to coordinate such a tax on a pan-European basis would face huge obstacles as taxation is a reserved power at national level.

Nevertheless, the new European Commissioner for financial services, Frenchman Michel Barnier, is a professed backer of so-called 'Tobin' tax ideas.

Barnier said in a recent AFP interview that such contributions from banks, insurers and markets could be used to lessen the budgetary load on states weighed down with post-crisis deficits and debts, or to take on challenges like fighting climate change or ring-fencing food security.

Britain's Chancellor Alistair Darling, whom Barnier will visit in the City of London next month, said last week that EU finance ministers had a "constructive discussion" on proposals by Sweden for "a levy on systemically important financial institutions," which will be debated in Madrid in April.