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EU pushes financial tax despite crisis

18 June 2012, 22:21 CET
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(LOS CABOS) - EU Commission chief Jose Manuel Barroso pledged Monday to press for a tax on financial transactions, calling for action to help the world's poor despite the crisis engulfing the eurozone.

France, with support from Germany, has led calls for an EU-wide tax on financial transactions but the idea has faced fierce resistance from Britain which fears the move would hurt London's status as a financial hub.

Barroso, taking part in a summit of the Group of 20 major economies in the Mexican resort of Los Cabos, called for "not forgetting the poorest of the world in this particular moment in our economic situation."

"We want a financial transaction tax to become a reality, in Europe and if possible at global level. It is a question of fairness and it would enable us to help more of the world's poor," Barroso told reporters.

The European proposal would use the tax primarily to fund public efforts to repair the financial sector in the wake of the global economic meltdown in 2008.

Proposals for a global tax have called for the revenue to support development in poor nations or to help the worst-hit cope with the effects of climate change.

The European parliament in May overwhelmingly approved a proposal to set tax rates within the 27-nation bloc of 0.1 percent for transactions of shares and bonds and 0.01 percent for derivatives.

But British Prime Minister David Cameron has vowed to "fight it all the way."

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