The European Commission has agreed to bring forward proposed legislation for a financial transaction tax (FTT) for ten EU states that want to go ahead with it.

The FTT would enable states to levy a tax on financial transactions, such as share deals, in order to provide funds for dealing with future banking problems.

This would avoid putting the burden of bank bailouts on ordinary taxpayers.

Under EU treaties, a measure that is not approved by all states (or even a two-thirds majority) can still go ahead for a smaller number of states.

France, Germany, Italy, Spain, Portugal, Belgium, Greece, Austria, Slovakia and Slovenia all support the idea of a financial transaction tax.

They want to use a procedure known as an enhanced co-operation to introduce the measure, which would only apply to those ten states.

Once the measure is open to all other states to join in future if they wish and it does not undermine the single market, it is open to the commission to draw up draft legislation to enact the measure.

Ireland opposes the financial transaction tax, saying that it already levies stamp duty on many financial transactions.

It also fears a loss of competitiveness and jobs to the city of London, as the UK is also opposed to the FTT idea.