The European Commission on Tuesday agreed a formal first step enabling 10 EU nations to launch a hotly contested Financial Transactions Taxslated to raise billions for the public purse. 

After plans to launch the tax across the European Union were scuttled during months of raucous talks by Britain and others, the EU executive proposed that 10 countries in favour, including France, Germany, Italy and Spain, go ahead on their own. 

The Commission said all the legal conditions to impose such an FTT had been met and that it believed the tax would not undermine the workings of the European single market which seeks to ensure a level playing field for all. 

"This tax can raise billions of euros of much-needed revenue for member states in these difficult times," Commission president Jose Manuel Barroso said. 

"This is about fairness," he said. "We need to ensure the costs of the crisis are shared by the financial sector instead of shouldered by ordinary citizens." 

The introduction of the FTT by a small group of EU nations is possible via rarely-used powers of "enhanced cooperation", under which a minimum of nine nations -- one third of the EU's 27 member states -- may trailblaze new legislation. 

This has been used twice before when the EU-27 failed to reach unanimity, in cross-border divorce law and more recently for the EU patent. 

Proponents of a transactions tax, which has its roots in the 1970s, believe it will help curb the culture of greed that led to the 2008 global financial crisis and ensure an industry that had to bailed out pays its fair share. 

But Britain opposed taxing trade in stocks and other financial instruments, fearing it would see its status as the top European financial market threatened as business moved to New York, Hong Kong or Singapore. 

Britain lays claim to some three quarters of the entire European finance industry. 

The commission proposal must yet be formally approved by members of the 27-nation bloc who will not be applying the FTT, and by the European Parliament, before taxation commissioner Algirdas Semeta can release a detailed proposal on the tax. 

Nine months ago he proposed a low-rate EU-wide tax -- 0.1 per cent on share and bond trades, 0.01 per cent on other transactions -- expected to bring in 57 billion euros a year. 

With the group of 10 accounting for two-thirds of Europe's economy, likely revenue from the tax is likely to be substantial. Also in the group are Austria, Belgium, Portugal, Slovenia, Greece and Slovakia. 

Within the eurozone, Luxembourg, which houses a sizeable finance sector, also stayed out alongside Cyprus, Finland, Ireland, Malta and the Netherlands. (Economic Times)