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Around 50% of the revenue from the tax will be spent on international solidarity.

PHOTO: ISTOCK

France to use 50% of FTT revenue on overseas aid

22 October 2015

The French parliament has adopted a proposal to allocate 50% of the Financial Transaction Tax to the country's development budget, bringing to an end four years of cuts.

On Monday 19 October, MPs voted to greatly increase the share of revenue from the Financial Transaction Tax (FTT) that goes towards France's international solidarity efforts.

France raised around €700 million from the Financial Transaction Tax in 2015, and has projected revenues of at least €932.7 million for 2016.

In its original draft budget for 2016, the French government had earmarked €260 million of FTT revenue for official development assistance (ODA). This €100 million increase would have stabilised the ODA budget for the first time in five years, after €700 million of cuts since 2012.

But for members of the French parliament, this was not enough, and they pushed the government to increase the share of the FTT reserved for development. In total, around 50% of the revenue from the tax will be spent on international solidarity.

François Hollande recently committed to increasing the French ODA budget by €2 billion by 2020, on top of another €2 billion increase specifically dedicated to fighting climate change.

With the recent adoption of the Sustainable Development Goals and the up-coming COP 21 in Paris, MPs have been keen to hold the president to account.

The MPs' vote will increase the development assistance budget by around €200 million.

Friederike Röder, the director of ONE France, welcomed the increase. "We now have 50% of the FTT dedicated to development. The MPs' vote will increase the development assistance budget by around €200 million, or 6%."