In February 2013, the European Commission tabled a proposal aimed at introducing a Financial Transaction Tax (FTT). Negotiations are taking place through the so-called 'enhanced cooperation' procedure' with 10 Member States. The participating countries were initially Belgium, Germany, Estonia, Greece, Spain, France, Italy, Austria, Portugal, Slovenia and Slovakia. Estonia withdrew its participation in March 2016.

The proposal has the same scope and objectives as the Commission's initial proposal for an EU-wide FTT. It involves a minimum 0.1 % tax rate for transactions in all types of financial instruments, except for derivatives which would be subject to a minimum 0.01 % tax rate in the participating countries of the enhanced cooperation.

The adoption of the directive requires unanimous agreement of the participating countries (within the Council), after consulting the European Parliament and the European Economic and Social Committee.

The participating countries have regularly held meetings on the proposal, but the issue has remained so far at a standstill in Council.

In June 2023, the Commission stated that 'the prospects of reaching an agreement' [on the FTT] in the future were 'limited' adding there was 'little expectation that any proposal would be agreed in the short term.'        

In its work programme for 2026, the European Commission indicated that it intends to withdraw the FTT proposal.

References:

• EP Legislative Observatory, Procedure file on implementing enhanced cooperation in the area of financial transaction tax (FTT), 2013/0045(CNS) 
• Council of the EU, Draft Council decision authorising enhanced cooperation in the area of financial transaction tax - common guidelines, January 2013
• European Parliament, Legislative resolution of 3 July 2013 on the proposal for a Council directive implementing enhanced cooperation in the area of financial transaction tax, July 2013
• Council of the EU, ECOFIN Report to the European Council on tax issues, June 2018
• Council of the EU, ECOFIN Report to the European Council on tax issues, December 2018
• Council of the EU, ECOFIN Report to the European Council on tax issues, December 2019
• European Commission, Commission staff working document accompanying the Amended Proposal for a Council Decision amending Decision (EU, Euratom) 2020/2053 on the system of own resources of the European Union, June 2023,
• European Commission, Work Programme 2026, October 2025

Author: Pieter Baert, Members' Research Service, legislative-train@europarl.europa.eu