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The Commission's proposal, submitted on 23 October, would allow Belgium, Germany, Estonia, Greece, Spain, France, Italy, Austria, Portugal, Slovenia and Slovakia to introduce the FTT via enhanced cooperation (15390/12). In June, the European Council suggested that a decision be taken by December. The Netherlands indicated that they would also be interested in participating, under certain conditions.
Based on article 329(1) of the Treaty on the Functioning of the European Union, the decision requires a qualified majority for adoption by the Council, with the consent of the European Parliament. Adoption of the legislative act defining the substance of an enhanced cooperation would require unanimous agreement by the participating Member States.
A number of Member States not wishing to join the enhanced cooperation indicated that they would wish to receive a more detailed assessment of its impact on the internal market before supporting the decision authorising enhanced cooperation.
In 2011, the Commission proposed a directive aimed at introducing an FTT throughout the EU, but Council discussions in June and July this year revealed support for the proposal to be insufficient. In September and October, the 11 Member States wrote to the Commission requesting a proposal for enhanced cooperation, specifying that the scope and objective of the FTT would be based on that of the Commission's original proposal.
That proposal involved a harmonised minimum 0.1 per cent tax rate for transactions in all types of financial instruments except derivatives (0.01 per cent rate). The aim was for the financial industry, which many consider as undertaxed, to make a fair contribution to tax revenues, whilst also creating a disincentive for transactions that do not enhance the efficiency of financial markets.