Planned EU finance tax hits legal barrier

September 10, 2013 - 10:35 AM

BRUSSELS (AP) — The European governments' legal advisory service in Brussels has issued a damning internal memo that throws a planned financial transaction tax in jeopardy.

The European Council's experts say in the document seen by The Associated Press Tuesday the tax — to be introduced jointly by 11 European Union member countries — exceeds the member states' jurisdiction, may infringe on provisions of EU treaties and may have discriminatory effects on countries not taking part.

The legal opinion, dated Friday, is non-binding but is a setback to what some European leaders billed as their flagship policy in getting the financial sector to share the burden of Europe's economic woes.

Eleven of the EU's 28 member nations, including the biggest economies like Germany, France and Italy have vowed to introduce the tax.