David Coburn claimed that plans for a financial transaction tax, which the bloc will use to plug the vast £8.6billion budget gap left after Brexit, demonstrated Brussels’ “fiscal incontinence” and would have devastating consequences for the Continent.
Speaking at the EU Parliament in Strasbourg on Wednesday, Mr Coburn said: “Can I again try to explain what a thoroughly bad idea financial transaction tax is.
“Don’t you know who will pay it? It won’t be the fat cats in financial services, it will be their customers.
“Investors, you demonise them but they are responsible folk investing for their future in the hope that they will not become a burden on the state – mostly people saving for their pensions.”
Ukip MEP David Coburn blasted the EU for their "fiscal incontinence" in a passionate speech
I despair of economically illiterate fiscal incontinence that will drive down your ability to be competitive
The EU’s financial transaction tax was first proposed by the European Commission in January 2014, later postponed to September 2016 after much deliberation by Brussels.
The tax would be levied on all transactions on financial instruments between financial institutions when at least one party is based inside the European Union.
The Scottish MEP insisted that his European counterparts were simply intent on crushing a “whole generation” with “tax and regulation”.
“In the process, you will discourage business from using capital markets and encourage investors to look outside the EU,” Mr Coburn continued.
“The costs and risks of investing in Europe are being driven higher at a time when the returns of investing elsewhere are much more enticing.”
Chancellor Philip Hammond said that he would seek an alternative economic model for Britain if the Government fails to reach an agreement with Brussels, which could see the UK become a “tax haven” to entice business into the country.
Speaking to German newspaper Welt am Sonntag, Mr Hammond said if Britain were closed off from European markets after Brexit, it would consider abandoning a European-style model of tax and regulation, and “become something different”.
Get Quotes on Home Insurance
Mr Coburn continued to express his delight that the UK would not be a part of the EU’s “tax on pensions”, and gloated that Brexit will see European businesses flock to the City of London.
He added: “I am relieved that the UK will not be taking part in this tax on pensions.
May's Brexit speech: Europe reacts
Tue, January 17, 2017
Politicians and celebrities tweet their reaction as Theresa May unveils her 12 point plan for Britain leaving the EU.
1 of 9
The British Prime Minister Delivers Her Brexit Speech
“But, for your sake, I despair of economically illiterate fiscal incontinence that will drive down your ability to be competitive.
“And, of course, the business will move to the City of London.”
The International Monetary Fund, who had predicted a downturn in Britain’s post-Brexit economy have since upgraded their forecast for the country’s growth in 2017.
The head of the organisation Christine Lagarde praised the Bank of England’s decisions to cut interest rates after the EU referendum and consumers who had remained far more confident than expected.