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Europe

Sarkozy's financial transactions tax is 'mad'

Text by News Wires

Latest update : 2012-01-31

British Prime Minister David Cameron warned Monday that France's banks will flee to Britain if French President Nicolas Sarkozy goes ahead with plans to levy a 0.1% tax on financial transactions. Cameron called the French tax proposal "mad".

AFP - British Prime Minister David Cameron took a fresh dig at cross-channel rival France Monday, warning that French banks would flee to Britain if Paris introduces a financial transactions tax.

In comments aimed squarely at Nicolas Sarkozy after the French president reportedly criticised British industry, Cameron said the concept of the tax at a time of economic difficulty was "mad" and "extraordinary".

"I know I used the word mad, but I do think it's an extraordinary thing to do," he told a press conference after a European Union summit in Brussels, referring to the introduction of the tax.

"The European Commissioner has told us this would cost Europe half a million jobs. Now when we're all fighting for jobs and for growth, to do something that would cost so many jobs does seem to me to be extraordinary.

"And in the spirit of this healthy competition with France, if France goes for a financial transactions tax then the door will be open and we'll be able to welcome many more French banks, businesses and others to the UK.

"We'll expand our economy in that way as well as by rebalancing it, because I think this is the wrong move."

In a televised speech on Sunday, Sarkozy announced plans to introduce a 0.1 percent tax on financial transactions to come into effect from August this year in France.

He said in the same speech that Britain had no industry left, but while the British press played up the French president's comments, Cameron played down suggestions of a rift.

Asked if he would be backing the French president's re-election this year -- as German Chancellor Angela Merkel's party said she would -- Cameron said he was a "big supporter and friend of Nicolas Sarkozy and I wish him well.

"I think he's a remarkable man, I worked with him very closely over the Libya conflict, I think that was probably the closest that the British and French have worked together in the last 40 years, so I'm full of admiration for Nicolas," he added.

"Every now and again he says something I don't agree with -- today when he said that Britain is short of industry, we actually have a larger industrial sector than France."

Relations have been stormy between the two in recent months.

In December when Cameron criticised the eurozone's efforts to tackle its debt crisis, Sarkozy reportedly snapped that -- as Britain is not part of the single currency -- Cameron should shut up.
 

Date created : 2012-01-31

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