Robin Hood Tax news update
Since CSM last reported on the Robin Hood Tax there has been a lot of activity surrounding proposals to bring in a financial transactions tax in the EU. Even in the last month, talk about implementing a tax on the banks of this nature has hit major headlines in a variety of papers and websites.
So what has been going on?
As the cuts begin to take effect and have a real impact on working people across the country, the media has begun to pick up on the hypocrisy of the banks. As they slash jobs in branches, call centres and offices, those at the top of the ladder, many of whom were bailed out by the taxpayer for their irresponsibility, remain in their well paid positions or have moved on to bigger and better things [1].
On the same day as the Mirror reported these injustices, the guardian quoted David Hillman of the Robin Hood Tax campaign (RHTC) who said ‘We must not be deterred by bank lobbyists whose idea of “economic recovery” means increasing profits’. [2] It seems from the reports in the media that for banks, that the primary aim at this time is to return to business as usual. However it is becoming more and more clear that this is not a viable option, there must be reform, and the RHTC is putting forward a credible and realistic tax that could make a real difference for those who find themselves the victims of the economic downturn.
The actor Bill Nighy, a vocal supporter of the RHTC, appeared in the Mirror late last month promoting the need for the proposed tax and drawing attention to the good it could do, particularly in helping to alleviate hunger in our towns and cities. He claimed that the tax would eliminate the need for charity food banks, ensuring that no one is lacking in basic needs is a basic requirement of government. [3]
Simon Chouffot of the RHTC wrote on the website ‘Liberal Conspiracy’, drawing attention to massive subsidies received by UK banks from taxpayers to the tune of around £46 billion per year in addition to the £5 billion already being lost by the taxpayer every year just servicing the debt brought about by the bail out of the banks in the first place.
In contrast to this massive expenditure, which money effectively lost, in the year ending April 2010, the banks contributed just £15.4 billion in tax to the economy. These figures don’t make pleasant reading and Simon argues that introducing the RHT would be an achievable step in the right direction, ensuring the banks pay at least 0.05% in tax ‘every time banks carry out their casino trading’. [4]
The RHTC have joined the unions in criticising the Independent Commission on Banking report issued earlier this year by Sir John Vickers for not going far enough in addressing the immediate issues facing the economy and ensuring justice for the victims of the downturn. The RHTC said that the proposals ‘Missed an opportunity to put in place effective regulations to restrain greed and recklessness in bank boardrooms’. David Hillman commented that ‘Although the Vickers proposals may “get taxpayers off the hook” in future crises, we are still footing the bill for the banks’ past mistakes now’ adding, ‘Unless we ensure banks help to repair the damage done to our economy and society during the last financial crisis, it will be them who will have been let off the hook’. The Vickers report may not go far enough and Ed Balls has called for stringent measures to be put into place to ensure that proposals are carried out properly and without additional cost to the tax paying public. It seems that the report will not bring real and decisive change to the economy. [5]
Lastly there have been significant moves on the continent towards implementing a financial transactions tax (FTT), particularly on the part of France and Germany. The RHTC have applauded a plan put forward by Bill Gates and presented to G20 countries in Washington that outlined proposals to reform the financial sector, including an FTT. [6]The response has not been so warm to George Osbourne who has refused to support such a move unless there is some form of global agreement, ensuring Financial institutions would not leave the country to escape such a tax. [7] Commentators on Mirror.co.uk wondered however, whether the real reason for refusing to introduce the RHT in Britain is more to do with the fact that the Conservative Party is largely funded by the financial services sector. [8]
So the Robin Hood Tax Campaign moves forward and is gradually taking a prominent position in the ongoing debate surrounding the economy. For some it does not go far enough [9], for others, such as George Osbourne, it may seem a risky proposal. However, the growing worldwide support for the RHT suggests that it is a workable and important step forward in the cause of economic reform.
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