Enlarge image (© picture alliance / dpa / picture-alliance) Around a year ago, the European Commission first proposed a tax on certain financial transactions, like the trading of bonds, shares and derivatives, with the intention of recouping from the financial crisis, preventing another one and strengthening the EU single market – all the while letting the financial sector, a large contributor to the financial implosion of 2008/2009, throw in “a fair contribution at a time of fiscal consolidation.” The commission put January 1, 2014 as a start date.

Then, about two weeks ago and exactly a year after the commission's original press release, German Finance Minister Wolfgang Schäuble and his French counterpart Pierre Moscovici penned a joint letter requesting that the European Commission move forward with just such a tax, using so-called enhanced cooperation. Said cooperation is a maneuver that allows a minority of at least nine member states to proceed with legislation on which all 27 members do not wish to come along, as was the case with the transactions tax.

And on October 10, 11 EU members signed on to the idea. Enhanced cooperation requires nine members to commit before they cooperate on an issue.

The original proposal anticipated raising around 57 billion euros per year from the tax – money that would help EU states recover from the reverberations of 2008 while serving as a retribution of sorts to all the taxpayers who helped bail out big banks. Under the proposed bill, all those transactions in which at least one of the financial institutions participating were located in the EU would be taxed; bonds and shares at 0.1 percent and derivatives at 0.01 percent.

The initiative taken by France and Germany is a clear expression of needed solidarity in the international marketplace. The two countries, according to the Federal Ministry of Finance, “are expressing the need for European integration on financial market taxation with respect … to mitigating the consequences of the financial crisis.”

This is not a lone foray into financial regulation, something that has become an economic cornerstone. Finance Minister Schäuble, in a recent interview with the Japanese newspaper Nikkei, outlined three “chief causes” for the worldwide financial crisis. Beside high state debt and distended liquidity, the finance minister indicated a dearth of market regulation as a primary instigator of financial pitfalls. To beef up regulation, Minister Schäuble mentioned a number of steps Germany is taking and has taken since 2008, including the recently Cabinet-approved draft bill to mitigate high-frequency trading, the implementation of Basel III regulations and a project to strengthen European banking oversight.

The proposed transaction tax is another important stone in this new foundation, and it further serves the purpose as a great taxpayer recompense that would level the playing field between bank and citizen.

“The German and French governments will continue to strongly advocate the integration process,” said the finance ministry's statement, “and petition the other member states in order to achieve the broadest possible level of participation in the enhanced cooperation.”