In re GB v EU (part 2)

The proposed bankers' bonus cap is not the only threat that the plucky Chancellor is going to law to see off. Brussels bureaucrats plan to inflict yet another tax on the hard pressed, hard working families of Great Britain. The plan is to introduce a "financial transaction tax".

Q: Good grief! A tax on every transaction. That'll be ruinous won't it? We already pay vat at 20%. What rate are the idiots proposing?
A: A range. Between 0.01% and 0.1%.
[Pause]
Q: Well, ok, but still. Why should I have to pay the bloated, bungling Brussels bureaucrats even a penny?
A: You won't.
Q: What?
A: There's an exemption for the day-to-day financial activities of citizens.
[Pause]
Q: Ah yes, but what about the day-to-day financial activities of our hard-pressed businesses, smart arse?
A: They're exempt too.
Q: What?
A: They're exempt too.
Q: How do you mean?
A: They're exempt too.
[Pause]
Q: Well, ok, but what about non-day-to-day transactions. What about business investment, banking activities in the context of raising capital?
A: They're exempt too.
[Pause]
Q: Right. What about businesses that are in trouble and are trying to save themselves and the jobs of all those who work in them? What about transactions carried out as part of restructuring operations?
A: They're exempt too.
Q: Oh ffs. Really?
A: Yes. Would you like me to explain what it does apply to?
Q: That'd be good, yes.
A: Essentially, not the real economy but to the exchange of shares, bonds and derivative contracts.
Q: Well, ok. But what's the point?
A: The revenue raised would be between €16.4bn and €43.4bn per year, or 0.13% to 0.35% of GDP. If the tax rate is increased to 0.1%, total estimated revenues would be between €73.3bn and €433.9bn.
Q: Well, on reflection, that all sounds ok. I don't think a 0.01% tax is going to put anyone off doing anything, ever. Certainly not a bond trader. Why's it not happening again?
A: Because the UK is going to law to stop it.