German SPD Ministers Push For Share Trading Tax

The proposal for a stock-trading tax could help the SPD tap into popular discontent with financial market speculators.

Germany's Social Democratic (SPD) finance and foreign ministers called on Friday for the introduction of a tax on stock market trading, which they hoped could be applied across the European Union.

The SPD, which shares power with Chancellor Angela Merkel's conservatives, has seen the emerging Left party lure away many of its traditional blue-collar voters and is trying to win them back before a September federal election.

The proposal for a stock-trading tax could help the SPD tap into popular discontent with financial market speculators. Foreign Minister Frank-Walter Steinmeier, the SPD's candidate to challenge Merkel in September, has struggled to attract support.

"To help contain speculative excesses and to gain revenues, with which the consequences of the crisis can be reduced, we want to introduce a stock market sales tax," Steinmeier and Finance Minister Peer Steinbrueck said in a joint paper.

Stock trades of 1,000 euros or more should be taxed at a rate of 0.5 percent of the shares' value, rising to 1.5 percent for sales made via a clearing house and for financial products which would not be taxed in further transactions, they said.

Such a tax could generate up to 3.0 billion euros ($3.8 billion) in tax revenue for Germany, they said.

"We want to push for such a tax to be introduced EU-wide," the two ministers added in the paper, in which they laid out their principles on the future of financial market structures.

"More transparency must be produced for short-selling and damaging short-selling should be banned," they said, adding that executive pay should also be more transparent.

The two ministers also said off-balance sheet business should be banned nationally and worldwide.