It had to happen sooner or later. In fact it was predicted in this very blog months ago. The EU, in the form of Commission President José Manuel Barroso, has decided the best way to solve the internal contradictions of economic union, is to have even more economic union, oh, and a new tax.
Let's start with the tax. Barroso wants to skim 0.05% off every bank to bank transaction in Europe. He thinks this will help solve the problem of Greece being about to crash out of the euro. Or least, he implies it might. This tax (sometimes known as a Tobin Tax) would provide a big cash pile that could be used to bail out banks and countries when it all goes tits up. (The original Tobin Tax was only to be applied to foreign exchange conversions - Barroso wants to tax all transactions.)
Hmm... a big cash pile? A big cash pile doubtless to be collected and administered by the EU itself; and doled out by the EU to its friends and supporters. You can see why Barroso would want such a thing. Some people reckon this tax could raise as much as €50bn a year; enough to give a commission president sweaty palms just thinking about it.
Some of that money would sadly be coming out of yours and mine pockets in the form of higher banking charges. But on the plus side, some would also be coming out of bankers' bonuses and bank profits. So, not all bad then.
The tax would put paid to a devious practice of the big investment banks - high speed trading (HST). In HST the bank, using "co-located" computers, ie computers it has paid to have hosted in a stock exchange's own computer room so that they can talk extremely fast to the SE's own computers, intervenes in every transaction. For example if you decide to buy some Sainsbury's shares and tell your broker to buy 1000 shares "at best" but not paying more than £3 per share you will find that a high speed trader suddenly bids the price up to £3 just long enough for you to have to pay the maximum you were willing to go to. They do this by trading thousands of times for your one and discovering your price limit and corralling the whole market for a millisecond or two. They might buy and sell a million Sainsbury shares just to make sure you pay £3 rather than £2.90 for yours. But a tax on each transaction would spoil their fun. Suddenly their thousand trades would be costing them a lot of money.
There has been speculation that a financial transaction tax (FTT) would drive business offshore. Probably not much: the ordinary Joe Public punter wouldn't be much affected, and the parasitic banks need to be close to the public in order to prey on them. Some business might move from London to New York - large deals where the FTT starts to add up to a big number.
Barroso's other big idea is deeper economic union. By this he means the EU should be running the economies of member states, because obviously they're not competent to do it themselves. This means member state treasury departments would have to clear all spending with the EU beforehand, and of course, all borrowing as well. Our democracy would degenerate into an elected civil service - chosen by the people but taking their orders from Brussels.
However, since the UK isn't in the euro, it's unlikely the FTT or the further economic union will ever apply to us. If the rest of Europe wants it, let them have it.