web analytics

Time for the Robin Hood tax!

Written By: - Date published: 8:22 am, August 20th, 2011 - 21 comments
Categories: capitalism, International, tax - Tags: , , , ,

The Robin Hood / Tobin / Financial Transactions tax. We’ve written about it before here at The Standard. Earlier this year 1000 economists wrote to the G20 leaders – here’s an extract from their letter:

This tax is an idea that has come of age. The financial crisis has shown us the dangers of unregulated finance, and the link between the financial sector and society has been broken. It is time to fix this link and for the financial sector to give something back to society.

Even at very low rates of 0.05% or less, this tax could raise hundreds of billions of dollars annually and calm excessive speculation. The UK already levies a tax on share transactions of 0.5%, or ten times this rate, without unduly impacting on the competitiveness of the City of London.

This money is urgently needed to raise revenue for global and domestic public goods such as health, education and water, and to tackle the challenge of climate change.

Given the automation of payments, this tax is technically feasible. It is morally right.

We call on you to implement the FTT as a matter of urgency.

One of the very few possible arguments against this tax is that it less effective if it isn’t widely implemented (i.e. by most of the major economies).  Fortunately that argument is going to be a lot weaker in future! France and Germany are leading the way, and a Europe wide implementation could be the next step. Naturally the “financial sector” are squealing:

European markets hit by eurozone Robin Hood tax plans

Stock exchange shares and main indices lose ground as German chancellor Angela Merkel and French president Nicolas Sarkozy propose new financial transaction tax

Fears of a Europe-wide financial transactions tax sent tremors through the City and other European bourses after Angela Merkel and Nicolas Sarkozy backed the idea of a new levy.

Shares in banks and other financial institutions were hardest hit in downbeat London trading amid concerns that the tax would add to the cost of doing business and drive firms overseas.

What a pack of whiners these bankers are. They’re being asked to pay a fraction of one percent on each transaction. A tiny amount for any given trade or trader, but because there are so many (the volumes of such trades are so huge) it will raise a substantial sum for cash-strapped governments. Lest we forget, in 2009 governments (we the taxpayer) bailed out these same institutions to the tune of €3 trillion in Europe, £1.5 trillion in the UK, and $4 trillion in America.  I’ve lost count of how many more trillions have followed, but some estimates put the totals involved much much higher.  And now in return these same institutions are trying to dodge a very fair and much needed tax?  Shame on the lot of them.

New Zealand should be a very fast follower indeed on Robin Hood.  As Europe moves to implement it, so should we.  Labour has shown leadership and courage on the capital gains.  They should speak out again on this tax.  Use the income for social programmes, green infrastructure projects, or to reduce GST.  There is so much that could be done…

21 comments on “Time for the Robin Hood tax! ”

  1. John Dalley 1

    Interesting, if i remember correctly this was a ociasl Credit policy way back when.

    • Developments in Germany and France are worth watching. Financial transactions taxes are like other taxes. If you have them in only one place, they encourage participants in the affected industry to go elsewhere. But if they’re broadly adopted everyone is better off.
      Deutsche Welle had a useful analysis of the Germany-France discussions earlier this week. Commentators point out that discussion is heavily couched in terms of ‘willingness to entertain proposals’. But it’s still a courageous first step.

      • aerobubble 1.1.1

        I disagree, sure in a globalized economy pumped up by cheap high density energy.
        But now the tide has gone out, those countries like Germany who produce
        high quality goods and services are actually the price setters now. The market
        under cheap oil could do the dictating. It does not follow that an absolute rule
        actually is absolute or even relevent anymore. Its about where we will be in thirty
        years time, will the financial markets dominate when they don’t work today under
        the existing rules, they have to change and they will not do it under their own
        steam. The end of quantity and the retrun of quality. We do not need people
        who shift risk off the books, we need people who hold risk and are reward
        for retaining risk on books. The Thatcher years will be seen for what they truely
        were a mutated period of excessive stupidity and irrationality.Daylight became
        darkness, Night became the new Dawn. Zombies walked the land.

      • Bill 1.1.2

        “If you have them in only one place, they encourage participants in the affected industry to go elsewhere.”

        Dunno about that. It’s what financiers always threaten to do. But when it comes down to it they are in the game of making money and so can’t but help themselves to gather around like flies no matter the composition of the shit.

      • Colonial Viper 1.1.3

        Deglobalising speculative capital flows and building up local reserves of capital would be a good start.

        At the moment the banksters can take any government hostage simply by threatening to pull hundreds of billions of liquidity away from a country in two or three short days. A country can go from being liquid to total credit lock up overnight. Its loan payments denominated in foreign currencies will mushroom as the local dollar collapses.

        This is what Max Keiser calls ‘financial terrorism’. When sovereign nations are taken hostage by financiers.

    • mikesh 1.2

      I think it was a transactions tax that Socred advocated in days gone by., not an FTT. However I believe they are now backing the latter.

      • mik e 1.2.1

        Pay off the debt would be my top priority its costing $4billion a year just to pay interest. freeing up that kind of money would be enough to get rid of unemployment and poverty and our slide down the OECD .FUNNY how the RIGHT wing rubbish these policies all the time now we have three European right wing leaders advocating left wing policy Merkel and Sarkosy on FTT and Berlusconi on tax dodgers and raising tax on the wealthy. Maybe Key might steal some of these policies no out cry from the Trolls surprising that!

        • Colonial Viper 1.2.1.1

          Simple way of paying off NZ’s govt debt is to not issue any more debt and for the NZ govt to self fund by printing the money it needs interest free.

  2. Oligarkey 2

    IMO this doesn’t go nearly far enough. Until the major countries of the world get rid of private banking sector, nothing much will change because, as history shows, they always end up manipulating governments and society in to servitude through the issuance of debt, using reserves that they don’t hold (fractional reserve lending). It’s a fundamentally unjust system, and it beggars belief that most people simply accept it without question. Let’s have a democratically-run economy instead.

    • mikesh 2.1

      I’d say let the private banking sector continue to exist, but stop them producing counterfeit money.

      • Colonial Viper 2.1.1

        All basic utility functions of the banking system should be owned and controlled by the Government. It is far too important a function to give to private banks.

        The Bank of North Dakota, which is owned by the state of North Dakota, and which the state does all its business through, is the right idea.

        • DS 2.1.1.1

          Yes, North Dakota is an interesting one. It hearks back to the early decades of the twentieth century when North American farmers in the prairie states were radical populists and hated the eastern banking interests (it’s also why Canada’s major left-wing party, the NDP, was born in the prairie provinces). Of course, that radical tradition is long gone now, but North Dakota’s state-owned bank is a surviving relic of that.

    • Draco T Bastard 2.2

      …and it beggars belief that most people simply accept it without question.

      I’m of the opinion that most people have NFI that fractional reserve banking exists. I’d like to think that it’d be removed if they knew just how the banks are stealing from us.

  3. Thomas 3

    Sweden and Brazil abandoned their FTTs. I wonder why.

    I don’t think this tax has been well thought out. It seems distortionary.

    For one, it will support the creation of monopolies—companies that can ‘trade with themselves’ will have an advantage over smaller companies that need to pay the tax on their transactions.

    • Colonial Viper 3.1

      Sweden and Brazil abandoned their FTTs. I wonder why.

      Links please.

      I hear Swedish top tier income tax rate is 61% or thereabouts. Are you suggesting that their tax system is one we should follow.

      I don’t think this tax has been well thought out. It seems distortionary.

      The pros and cons of FTTs have been discussed and examined for decades. It is a very well established concept.

      What is distortionary is the % of GDP that unproductive financial services now represent. What is distortionary are the HFT (high frequency trading) antics in the financial markets manipulating and controlling price movements and trading volumes.

      An FTT would move financial markets back towards a far fairer footing.

      NB less than 30% of trading in the US and European stockmarkets are performed by humans now. The vast majority is run by HFT programmes.

      For one, it will support the creation of monopolies—companies that can ‘trade with themselves’ will have an advantage over smaller companies that need to pay the tax on their transactions.

      You’re definition of monopoly is completely made up.

  4. Bill 4

    Apart from the Mana Party, are there any other parliamentary parties committed to introducing a tax on financial transactions? The Greens perhaps?

    So, if it’s considered a big deal and an idea whose time as come by those on the left, then erstwhile Labour voters who ‘get it’ will be casting a vote for Mana or the Greens instead?

  5. randal 5

    MY preference is for Alabanian style autarchy, all money belongs to the state and no more leaf blowers or hardly davisons.
    then the government would know exactly where every penny was and people would have to base their lives on spirituality and not external referencing and posessions.
    Fat chance.

  6. HC 6

    Given the fact that France and Germany are seriously looking at introducing this tax, and that they are going to work on convincing other countries belonging to the EURO zone about its benefits, I think the idea is worth looking at.

    It would only amount to a fraction of a per cent and be applied universally on all financial transactions.

    Those that have favoured this tax have so far thought or realised that it is best to introduce it in as many countries – ideally globally.

    Of course certain businesses, particularly banks, share issuing and finance companies would view the tax as an unwelcome burden, and they would in some cases look at relocating their business operations to countries, where such a tax would not be levied.

    Consequently such a tax should ideally be introduced in co-operation with Australia, as that is our nearest trading partner and a nation we have very close ties with.

    Apart from that the French and German governments would hardly follow adventurous or foolish ideas, because they are advised by many more tax, financial and economic experts than NZ and Australia have combined.

  7. muzza 7

    Sadly if you think the G8 or G20 are going to implement this you are out of luck. Germany & France is all about the tighter consolidation of what was the consolidated EU. There is no evidence to suggest that a Tobin Tax or FTT or anything of the sort will be levied against the bankers. Why would turkeys vote for Christmas, its just not going to happen.
    What will happen is the fall of a major European Bank or possible two very soon, my pick is actually one from France and or Germany, take a guess..

Recent Comments

Recent Posts

  • NZ announces a third P-3 deployment in support of UN sanctions
    The Government has deployed a Royal New Zealand Air Force P-3K2 Orion (P-3) maritime patrol aircraft to support the implementation of United Nations Security Council (UNSC) resolutions imposing sanctions against North Korea, announced Minister of Foreign Affairs Winston Peters and Minister of Defence Ron Mark. “New Zealand has long supported ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Pacific trade and development agreement a reality
    Pacific regional trade and development agreement PACER Plus will enter into force in 60 days now that the required eight countries have ratified it. Trade and Export Growth Minister David Parker welcomed the announcement that the Cook Islands is the eighth nation to ratify this landmark agreement. “The agreement represents ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Securing a pipeline of teachers
    The Government is changing its approach to teacher recruitment as COVID-19 travel restrictions continue, by boosting a range of initiatives to get more Kiwis into teaching. “When we came into Government, we were faced with a teacher supply crisis,” Education Minister Chris Hipkins said. “Over the past three years, we ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Border exceptions for a small number of international students with visas
    The Government has established a new category that will allow 250 international PhD and postgraduate students to enter New Zealand and continue their studies, in the latest set of border exceptions. “The health, safety and wellbeing of people in New Zealand remains the Government’s top priority. Tight border restrictions remain ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • First COVID-19 vaccine purchase agreement signed
    The Government has signed an agreement to purchase 1.5 million COVID-19 vaccines – enough for 750,000 people – from Pfizer and BioNTech, subject to the vaccine successfully completing all clinical trials and passing regulatory approvals in New Zealand, say Research, Science and Innovation Minister Megan Woods and Health Minister Chris Hipkins. ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • International statement – End-to-end encryption and public safety
    We, the undersigned, support strong encryption, which plays a crucial role in protecting personal data, privacy, intellectual property, trade secrets and cyber security.  It also serves a vital purpose in repressive states to protect journalists, human rights defenders and other vulnerable people, as stated in the 2017 resolution of the ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Ministry of Defence Biodefence Assessment released
    The Ministry of Defence has today released a Defence Assessment examining Defence’s role across the spectrum of biological hazards and threats facing New Zealand. Biodefence: Preparing for a New Era of Biological Hazards and Threats looks at how the NZDF supports other agencies’ biodefence activities, and considers the context of ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • New Approaches to Economic Challenges: Confronting Planetary Emergencies: OECD 9 October 2020
    New Approaches to Economic Challenges: Confronting Planetary Emergencies: OECD 9 October 2020 Hon David Parker’s response following Thomas Piketty and Esther Duflo. Good morning, good afternoon, and good evening, wherever in the world you might be. I first acknowledge the excellent thought provoking speeches of Thomas Piketty and Esther ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Kaipara Moana restoration takes next step
    A Memorandum of Understanding has been signed today at Waihāua Marae between the Crown, local iwi and councils to protect, restore and enhance the mauri of Kaipara Moana in Northland. Environment Minister David Parker signed the document on behalf of the Crown along with representatives from Ngā Maunga Whakahī, Ngāti ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • New Zealand and Uruguay unite on reducing livestock production emissions
    Agriculture Minister Damien O’Connor and Uruguayan Minister of Livestock, Agriculture and Fisheries Carlos María Uriarte have welcomed the launch of a three-year project that will underpin sustainable livestock production in Uruguay, Argentina, and Costa Rica.  The project called ‘Innovation for pasture management’ is led by Uruguay’s National Institute of Agricultural ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • 3100 jobs created through marae upgrades
    Hundreds of marae throughout the country will be upgraded through investments from the Provincial Growth Fund’s refocused post COVID-19 funding to create jobs and put money into the pockets of local tradespeople and businesses, Regional Economic Development Minister Shane Jones and Māori Development Minister Nanaia Mahuta have announced. “A total ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Health volunteers recognised in annual awards
    Health Minister Chris Hipkins has announced 9 teams and 14 individuals are the recipients of this year’s Minister of Health Volunteer Awards.  “The health volunteer awards celebrate and recognise the thousands of dedicated health sector volunteers who give many hours of their time to help other New Zealanders,” Mr Hipkins ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Community COVID-19 Fund supports Pacific recovery
    The Minister for Pacific Peoples, Aupito William Sio says a total of 264 groups and individuals have successfully applied for the Pacific Aotearoa Community COVID-19 Recovery Fund, that will support Pacific communities drive their own COVID-19 recovery strategies, initiatives, and actions. “I am keen to see this Fund support Pacific ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Community benefits from Māori apprenticeships
    Up to 50 Māori apprentices in Wellington will receive paid training to build houses for their local communities, thanks to a $2.75 million investment from the Māori Trades and Training Fund, announced Employment Minister Willie Jackson today. “This funding will enable Ngāti Toa Rangatira Incorporated to provide its Ngā Kaimahi ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Training fund supports Māori jobseekers
    Rapidly growing sectors will benefit from a $990,000 Māori Trades and Training Fund investment which will see Wellington jobseekers supported into work, announced Employment Minister Willie Jackson today. “This funding will enable Sapphire Consultants Ltd. to help up to 45 Māori jobseekers into paid training initiatives over two years through ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Ruakura Inland Port development vital infrastructure for Waikato
    The Government is investing $40 million to develop an inland port at Ruakura which will become a freight super-hub and a future business, research and residential development for the Waikato, Urban Development and Transport Minister Phil Twyford, and Māori Development Minister Nanaia Mahuta announced today. The funding has been has ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Appointments made to Defence Expert Review Group
    Defence Minister Ron Mark announced today the establishment of an Expert Review Group to review a number of aspects of the New Zealand Defence Force’s (NZDF) structure, information management and record-keeping processes.  The Expert Review Group’s work arises out of the first recommendation from the Report of the Government’s Inquiry ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • No active community cases of COVID-19
    There are no active community cases of COVID-19 remaining in the country after the last people from the recent outbreak have recovered from the virus, Health Minister Chris Hipkins said today. “This is a big milestone. New Zealanders have once again through their collective actions squashed the virus. The systems ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Clean energy upgrade for more public buildings
    More public buildings will be supported by the Government to upgrade to run on clean energy, the Minister for Climate Change James Shaw announced today. Minister Shaw announced that Lincoln and Auckland universities will receive support through the Clean-Powered Public Service Fund to replace fossil fuel boilers. Southern, Taranaki, and ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Schools back donations scheme for the second year
    More schools have opted in to the donations scheme for 2021, compared to 2020 when the scheme was introduced. “The families of more than 447,000 students will be better off next year, with 94% of eligible schools and kura opting into the scheme,” Education Minister Chris Hipkins said. “This is ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Ruapehu cycle trails gets PGF boost
    The spectacular Mountains to Sea cycle trail in Ruapehu District will receive $4.6 million in funding from the Provincial Growth Fund for two additional trails, Regional Economic Development Minister Shane Jones announced today. “This is an exciting development for the local community, and one that will provide significant economic opportunities ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Update to air border order strengthens crew requirements
    Additional measures coming into effect on Monday will boost our defence against COVID-19 entering New Zealand through the air border, Health Minister Chris Hipkins said today. “As part of our precautionary approach and strategy of constant review, we’re tightening the requirements around international aircrew,” Chris Hipkins said. The COVID-19 Public ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • A true picture of Māori business activity
    A better picture of the contribution Māori businesses make to the economy will be possible with changes to the way information is collected about companies and trading enterprises. Māori Development Minister Nanaia Mahuta and Small Business Minister Stuart Nash have announced a new option for Māori enterprises who are part ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • PGF funding for Taranaki projects
    The South Taranaki museum, a New Plymouth distillery and a Pasifika building firm will benefit from a Government investment totalling more than $1 million, Regional Economic Development Minister Shane Jones says. The $1.05m in grants and loans from the Provincial Growth Fund (PGF) will help the recipients expand and create ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • Fijian Language Week 2020 inspires courage and strength during COVID-19 pandemic
    The Minister for Pacific Peoples, Aupito William Sio says the theme for the 2020 Fijian Language Week reflects the strong belief by Fijians that their language and culture inspires courage and strength that is strongly needed in times of emergencies, or through a significant challenge like the global COVID-19 pandemic ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • Trades training builds on iwi aspirations
    An investment of $2.025 million from the Māori Trades and Training Fund will support Māori to learn new skills while making a positive difference for their communities, announced Employment Minister Willie Jackson today. “K3 Development Limited Partnership will receive $2,025,000 for its Takitimu Tuanui apprenticeship programme, which will support the ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • Conservation Minister plants two millionth tree in Raglan restoration
    A long-term conservation project led by the Whaingaroa Harbour Care group in the western Waikato reaches a significant milestone this week, with the planting of the two millionth tree by the Minister of Conservation Eugenie Sage. “Planting the two millionth tree crowns 25 years of commitment and partnership involving Whaingaroa ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • Seniors – our parents and grandparents
    International Older Persons Day is a chance to think about the individual older New Zealanders we know and to confront ageism, Seniors Minister Tracey Martin said today. “What happened around COVID-19 is a reminder that our over-65s are a very large and diverse group of people and we need to ...
    BeehiveBy beehive.govt.nz
    3 weeks ago