European Union lawyers said the transaction tax plan proposed by eleven European member states was illegal. The proposal would levy taxes on financial transactions beginning in 2014. Some EU member states wanted to levy a tax on deals involving stocks, bonds, securities lending, derivatives and repurchase agreements. These were Germany, Italy, France, Austria, Spain, Belgium, Portugal, Greece, Slovenia, Estonia and Slovakia.
Under the plan, banks would need to pay governments an estimated EUR 35 billion annually after getting bailed out by taxpayers in the financial crisis that gripped the region from 2007 to 2009.
The 14-page legal opinion from the lawyers of the EU block was not binding. However, it would be more difficult for the plan to push its current version ahead. Britain and other EU members already expressed their opposition to the plan.
The conclusions of the opinion would be taken into consideration by the finance minister of the bloc. They would then decide if the measure needed to be refined or a simpler form of taxation would be set up in its place. They could also opt to scrap the plan entirely.
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