From War on Want: more information at www.robinhoodtax.org.uk
The financial crisis that has swept across the world economy since 2008 has destroyed jobs and livelihoods in developed and developing countries alike. The colossal bailouts given to the banking sector by UK taxpayers have raised the prospect of public service cuts and further reductions in social welfare.
War on Want and many other campaigns organisations, trade unions, women's organisations and faith groups are now calling for the introduction of a financial transactions tax on banks, known as the Robin Hood Tax, to repay some of their debt to society and to provide ongoing funding for public services and social welfare programmes into the future.
A tax on the banks' transactions in foreign currencies, shares and derivatives would raise significant sums for spending on public services, climate change mitigation and anti-poverty programmes, both in the UK and overseas. If applied globally at an average rate of 0.05%, such a tax could raise as much as £250 billion every year.
The UK already has a stamp duty of 0.5% on share transactions, and it is perfectly possible for the government to introduce its own currency transactions tax on sterling alone. Calculations published by War on Want and the United Nations University show that even at the tiny rate of 0.005%, a sterling currency transactions tax would raise an estimated £3bn each year in additional revenue for use on anti-poverty programmes.
Including other major currencies such as the yen, dollar and euro would increase that figure many times over - but the good news is that the UK does not need to wait for others to implement a Robin Hood tax. The British government can introduce a currency transactions tax on sterling right now.
War on Want launched the first UK campaign for a Robin Hood tax (technically named the Tobin Tax after economist James Tobin) on foreign currency transactions in the wake of the East Asian financial crisis of 1997-98. Millions of people in Indonesia, Thailand, South Korea and the Philippines lost their jobs and their livelihoods as foreign currency speculators withdrew their money from Asian economies almost overnight. A Tobin Tax would stem the rapid flow of 'hot money' in and out of currencies, bringing stability so as to prevent a recurrence of the chaos caused in the East Asian crisis.
The film below, produced as part of War on Want's original Tobin Tax campaign, shows what happens when currency speculators prey on developing economies. Our thanks to Radiohead and Ewan McGregor for their contributions.