Taxing Banks for their Debt to Society

Excerpt from The Guardian, 10 November 2009

'Gordon Brown's statement of support for a tax on global financial transactions is a welcome call on the banks to repay their debt to society. It is also a victory for the international Tobin tax movement, which has laboured hard for this moment over many years. Our task now is to fight the political backlash which is already mounting, and to defend the idea of financial transaction taxes as a means to the progressive redistribution of economic gains...

There is now considerable political momentum in Europe and the wider world behind a tax that would cover the full range of financial transactions, not just currency speculation. Several such taxes already exist, of course, including the 0.5% stamp duty already payable on all UK share dealings. Even at a lower rate of just 0.05%, Austrian government figures indicate that a standard tax across stocks and shares, currencies, derivatives and other financial transactions could generate a massive $700bn (£420bn) a year.

The trillion dollar bailouts provided to the banks have plunged our national economies into long-term debt, threatening deep cuts to public services and the loss of thousands of public sector jobs. The billions that could be raised by a financial transactions tax offer a means for us to recoup those losses and to direct funding towards frontline public services, anti-poverty programmes or adaptation to climate change. The forces of reaction may be massing in opposition, but this is a battle we cannot afford to lose.'