La Tobin tax introduced laid down by the stability Law it will be easy to dodge and at the same time it will harm those who trade derivatives. The need to introduce the levy on financial transactions "is not in doubt, however some rationalization could be appropriate". This is the alarm raised today by the president of Consob, Joseph Vegas, during a hearing in the House Finance Committee.
The problem, according to Vegas, is the not "perfect alignment" of the levy with the "European provision", since "the law is called to operate in the narrowest national context". It will remain possible "for non-residents in Italy to carry out transactions on Italian shares abroad without being required to pay the tax - argued the number one of Consob - and for this reason risks of avoidance through the delocalisation of important sectors of the national financial industry".
But that's not all: “The risks associated with the introduction of the Tobin tax could be amplified in the event that Italy adopts the tax in advance of the entry into force of the European directive on the matter”. For Vegas, in this case, “although the Italian provision constitutes a sort of 'bridging legislation' intended to operate only temporarily, it could in any case cause even irreversible 'crowding out' effects on the markets. The tax recently introduced in France, on the other hand, contains some provisions capable of mitigating the negative effects deriving from the isolated adoption of the tax”.
As for derivatives, the president of Consob believes that the tax "leads to a strong penalty" for those who work with these tools. The stability bill, explained Vegas, introduced a stamp duty on the purchase and sale of shares of Italian issuers and on transactions in derivatives with a single rate of 0,5%, "to be applied respectively to the value of the transaction and to the value reference notional".
The Italian tax “departs from the draft of the European Commission of September 2011 due to the lack of differentiation of the rates according to the type of financial instrument negotiated – added Vegas -. This determines a strong penalization of operations in derivative instruments. Furthermore, with respect to the aforementioned proposal, there is an explicit reference to the nationality of the issuer, while there is no reference to the principle of residence in Italy of the intermediary as a further element for defining the scope of application of the tax”.
