Nine EU countries have written to Denmark as EU President asking for urgent clarification on whether a transaction tax will be introduced or not.

“We strongly believe in the need for a financial transaction tax implemented at European level as a crucial instrument to secure a fair contribution from the financial sector to the costs of the financial crisis and to better regulate the European financial markets,” the nine countries write.

The letter, is signed by the Italian Prime Minister Mario Monti and countersigned by finance ministers from Germany, France, Austria, Belgium, Finland, Greece, Italy, Portugal and Spain. Signatories urge the Danish presidency to ensure that the issue is clarified this spring and possibly at the March EU summit.

In a written response, the Danish presidency has welcomed the approach saying that the presidency “is currently investigating how the request can be accommodated”.

The transaction tax - or Tobin tax as it is sometimes known – is a difficult issue for the Danish government. The Social Liberal coalition party is generally opposed to the tax, while the coalition Social Democratic and Socialist People’s Party are generally in favour.

The label Tobin Tax is something of a misnomer, as Nobel Economics Laureate James Tobin's proposal was solely a tax on short-term currency transactions.

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