About three months ago, I essayed a piece on Germany and the big discussion for a stock purchase tax. The idea was that they'd generate a fair amount of money....leaning more on capitalists and investors, than the 'little' guy. When you bought stock, you would be taxed at .2-percent on the transaction value of stock (in domestic stock opportunities). The key here....the company holding the stock had to be valued at 1-billion Euro or more. Smaller companies? It had NO effect.
Yes, it was aimed at strictly twenty-odd companies around Germany, and maybe another fifty around the EU.
The game here? If you bought 1,000 Euro of stock, you'd pay the German government 2-Euro.
Waivers? Apparently, this idea included a waver for Initial Public Offerings (IPOs). And I should note....derivatives and debt instruments were to be excluded.
To make all of this work....the German Finance Minister....Scholz....needed the bulk of the EU to go along. If they didn't.....then Germans would funnel their money out of the country, and invest in non-German companies to avoid the stupid tax.
Well....this odd thing came up over the weekend. The majority of the EU said 'no', and there's strong doubt in Brussels that a united tax can occur.
The mess now? Here's this funny problem, which you can ponder about. Scholz came up in the past four weeks and agreed to fund a basic pension deal in Germany....bringing marginalized pension folks from welfare status....up to a decent pension level. The instrument which was going to help create this extra money path? Well....the stock tax program.
I sat this morning and was reading over various accounts of the tax mess, and the basic pension mess.....wondering how Scholz got himself so deep into problems. If he can't deliver the basic pension deal (slated for 2021), then the public will go fairly negative against the SPD Party.
Will Chancellor Merkel go and spread some 'magic dust' to bring the EU along? I kinda doubt it. Maybe ten years ago, she might have done so. But this is a different period today.
So the basic pension hype....is finished? No, but they will end up taking the funds required from general taxation money, and someone down the line will lose a billion or two.
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