A group of 11 European Union countries has been given the go-ahead to work on the introduction of a tax on financial transactions.

The tax is designed to help pay for the rescue of Europe's banks and discourage risky trading among the 11 countries. According to the decision, trades in bonds and shares will be taxed at 0.1 percent and trades in derivatives at 0.01 percent. The decision also needed approval by the EU’s 27 finance ministers.

It is estimated that such a tax across the 27-nation bloc could yield 35 billion euros a year.This would help out governments, which have had to pay for bank rescues in the past. Germany, France and nine other nations had initially hoped the tax would be adopted by the entire EU.

However, several countries, including Britain, refused to endorse the measure amid concerns over its economic impact.