Stamp Out Poverty Campaign : Tobin Tax Update - Spring 2004

Brown talks of Tobin Tax at recent high-level poverty conference

At last year’s Labour Party conference Gordon Brown made a stirring speech powerfully stating the woeful lack of money spent on global healthcare: “Today two million people round the world die each year from tuberculosis – a curable disease. One million die from malaria – a preventable disease. Three million die from aids – a treatable disease…Yet all the world’s development aid amounts to just five pence a week for the health of each sick African child”.

The Chancellor explicitly expressed his commitment to securing far greater revenue to pay for the UN Millennium Development Goals when he spoke in February at the ‘Making Globalisation Work For All’ conference, which was also addressed by Brazil’s President Lula, U2’s Bono and Live Aid hero, Bob Geldof. Although the Treasury is still keen to push the International Financing Facility (see our position paper: www.tobintax.org.uk/IFFpaper) it seems clear they also have an open mind in respect of other new funding streams. As Gordon Brown stated in his opening speech:

“Let us continue to work with you to examine the Tobin Tax.”

Urgent Action – Urgent Action – Urgent Action

Tobin Tax Day last year saw the launch of the Tobin Tax Petition. THANK YOU to all who have collected and sent in petition forms as thousands of signatures have now arrived at the office. But we need thousands more. So we have decided to extend the date of this activity beyond the original deadline of 31 March. Getting signatures lets many people know about the Tobin Tax and the completed forms will be used in a high profile action later this year. Please get a form at www.tobintax.org.uk/tobinstreetpetition (or call: 020 7620 1111) and ask friends, family and workmates to sign it. The more signatures the better !!!

Important advance in Tobin Tax proposition

A new report by the Tobin Tax Network which builds on ground-breaking research conducted over recent months is due out soon. By speaking to people working in the foreign exchange market we have developed a far more rigorous proposition of how exactly to implement the Tobin Tax. We have also developed arguments which show that the tax is in the interest of virtually all organisations, including commercial ones. There is an extremely compelling case for small, medium and large businesses to embrace the Tobin Tax, as it would create greater market stability benefiting trade, assisting growth and increasing employment. Indeed, the tax would only fall on relatively few corporations, namely the very large banks. The Royal Bank of Scotland (which owns Nat West) recently declared profits of £6,100 million. HSBC declared greater profits of £7,700 million. It is difficult to believe that these banks could not afford to pay out some of this money to the world’s most needy people. The report is due to be published in the summer.

International

Belgium – legislation very close: Tobin Tax legislation is working its way through the final stages of the Belgian Parliamentary process. The vote will be close. By the end of June we very much hope Belgium will be the second European country to pass the Tobin Tax into law.

Ireland – Susan George urges Irish Government: Ireland has been urged to use its Presidency of the EU to push for the introduction of an international tax on currency transactions. Susan George, a leading author on development economics, said the EU should not be discouraged by US opposition and that the Tobin Tax should be introduced on a regional level initially. “It should start with the euro, and could be rolled out for other currencies after that. If you sit around and wait for the Americans you will be waiting forever. Europe is going to have to take the initiative.”

Brazil – Lula presses Kofi Annan and Jacques Chirac: Brazilian President Luiz Inacio Lula da Silva, who recently met with UN Secretary General Kofi Annan and French President Jacques Chirac to discuss the fight on hunger, is looking to firm up his plans for a tax on international transactions to fight poverty. One of Lula’s foreign policy advisers said recently that financing this global fund could come from a tax on international financial transactions.

India – Central Bank joins Prime Minister in favouring Tobin Tax: India’s Reserve Bank has suggested taxing foreign exchange inflows in a recent report on Currency and Finance. Backing by India’s Central Bank for this type of measure follows favourable comments for a Tobin Tax by the Indian Prime Minister, Atal Behari Vajpayee, last year.