EU financial transaction tax legislation eyed 'after summer'

(BRUSSELS) - The European Commission will propose after the summer legislation to impose a tax on financial transactions in the European Union, the EU's executive branch said Monday.

In a letter to EU leaders ahead of a two-day summit this week, European Commission president Jose Manuel Barroso said the EU executive would at the same time work on a global-level tax for a G20 summit in France in November.

"In line with the conclusions of our last meeting, the Commission is completing its impact assessment and will present a formal legislative proposal after the summer," Barroso said.

"Our analysis shows that there is a strong case for deciding on a financial sector tax in the EU as a first step," he said.

"With a view in particular to the G20 Summit in Cannes, we will in parallel continue to work for a global agreement on a financial transaction tax," Barroso added.

EU states are divided over an European-level financial transaction tax, with Britain fearing it would trigger a capital flight.