User:389melanie/Robin Hood tax
The Robin Hood tax is a proposed tax on Financial transactions. It is similar to the Tobin tax, which was proposed in 1972 by James Tobin, but never implemented.
The campaign for the Robin Hood tax was launched on 15 February 2010. The campaign is being run by a coalition of charities and organisations .
The Campaign[edit]
The campaign has proposed to set a tax of between 0.005 and 0.05 per cent on a range of financial transactions. The tax would be applied to banks, hedge funds and other financial institutions.
The amount of money raise would depend on a number of different factors, including how many countries agree to the tax and the rate. The campaign have said, "$400 billion is our best estimate of what the tax will eventually raise from a range of rates on different transactions."[1]
It has been proposed by the coalition that the money raised from this tax be split between domestic use and international aid[2].
Comparison with the Tobin Tax[edit]
Tobin suggested a form of currency transaction tax. This is a type of financial transaction tax, which taxes specific types of currency transaction. This term has been most commonly associated with the financial sector, as opposed to consumption taxes paid by consumers.
The Robin Hood tax is similar to the Tobin tax but would apply to broader transactions in the financial sector.
Another difference between the Robin Hood Tax and the Tobin Tax is that the Tobin Tax was intended to stabalise the economic market rather than generate revenue[3]. A key point in the Robin Hood Tax campaign is that it would generate revenue which could be used domestically and to fund international aid[4].
Arguments against the tax[edit]
- Universal agreement to it is unlikely[5]
- The Argument: It will not be possible for the tax to be implemented successfully because in order to do so it would have to be implemented universally. It is unlikely that every country would agree to the tax.
- Counterargument: Many countries already have successful Financial Transaction Taxes. The UK's stamp duty on shares is one such tax which has been highly successful and has not stopped the market being profitable.
- The Argument: It will not be possible for the tax to be implemented successfully because in order to do so it would have to be implemented universally. It is unlikely that every country would agree to the tax.
- Worry that the burden of the tax will be shifted onto consumers[6]
- The Argument: Banks and financial institutions will move the cost of the tax onto consumers
- Counterargument: The financial sector is extremely lucrative and can afford to pay this tax from their own resources. The competativeness of the market would act as an incentive for them to absorb the costs rather than passing them on.
- Viability of collection[7]
- The Argument: Even if this tax was in place, collecting it would be too difficult.
- Counterargument: Taxes would be collected at the point where a deal was settled. As financial transactions are now computerised and automated, collecting revenue would be straightforward and inexpensive.
Celebrity involvement[edit]
The campaign involves a film made by Richard Curtis and staring Bill Nighy, in which Bill Nighy plays a banker who is being questioned about the Robin Hood tax[8]. He eventually admits that the tax would be a good idea and would not be too damaging to the financial sector.
Online campaign[edit]
The proposed Robin Hood tax has been accompanied by a large digital campaign. The main sources for this are:
References[edit]
- ^ FAQ: But where exactly will this money come from?
- ^ FAQ: How would you spend the Robin Hood Tax?
- ^ Tobin's concept
- ^ How it works
- ^ FAQ: Don’t all countries have to implement a Robin Hood Tax at once for it to work?
- ^ FAQ: But won’t the costs be passed on to us anyway?
- ^ FAQ: Is a Robin Hood Tax practical? How would it be collected?
- ^ Robin Hood tax homepage with film