The EU is worried. Britain is refusing to pay Brussels' proposed divorce settlement based on the figures they have issued. Understandably, British taxpayers and 52 per cent of those who voted for Brexit last year, and the many Remainers who want the Government to continue with the process of leaving the trading bloc, cannot stomach such a figure.
The EU has a series of mini crises unfolding throughout the continent. In Spain, Catalonian independence is threatening to tear apart that nation state, which could have consequences for the fragile construction of the trading bloc's economy.
In Italy, the Five Star Movement is on the verge of winning power and pulling their country out of the euro, which they view as a populist solution to Italy's problems. Brexit is the last situation they need to deal with. Euroscepticism is now more widespread than ever before, especially with Austria and the Czech Republic electing anti-EU politicians. Of course, the refugee crisis continues to challenge the EU's foundations.
A financial transactions tax will never work
With the UK on the verge of leaving, regional leaders who gathered for the CPRM meeting in Helsinki have proposed an old solution to the new problem of Brexit; a financial transactions tax. Such an answer will never work. David Cameron rightly earned universal praise across Britain in 2011 when he vetoed this ludicrous idea and here is why it will not work now.
When banks employ new staff, they have to pay a tax to the Government through a percentage of the employee's salary. But to add a financial transactions tax on top of that would decrease their profits further and destroy jobs, as opposed to creating them.
Sweden once had a financial transactions tax. The results were devastating and resulted in thousands of jobs losses.
Once the situation was reversed, the Scandinavian nation then succeeded in creating more jobs. A unilateral financial transactions tax would result in reduced business across Europe.
The EU is in a vulnerable position
As already stated, the EU is in a vulnerable position. Its days as an organisation are numbered. A financial transactions tax would result in lower volumes and lower productivity.
This means, critically, less tax revenue for the EU. And who does that benefit? Nobody. If the trading bloc hopes to survive, it needs to create an innovative solution to make up for the shortfall caused by Brexit, but this tax is not the answer.
