The RHT campaign continues to show the remarkable ‘how change happens’ potential of a response to shocks (in this case, financial crash + austerity = governments desperate for new sources of revenue + impending collapse of aid flows from many donors + massive public antipathy towards the banking sector = perfect time to campaign for a new tax on banks). Here’s a summary of the latest briefing from Sherwood foresters Max Lawson and Jasmine Burnley. Full briefing here.
• Despite fierce opposition and lobbying by the financial sector, there is a good chance that a coalition of 9 countries (Austria, Belgium, Finland, France, Germany, Greece, Italy, Portugal and Spain), representing 90% of Eurozone GDP, could push ahead and implement an Financial Transactions Tax (FTT, the official name for the Robin Hood Tax) in 2012. This could raise 38 billion euros. All of the nine finance ministers wrote to the Danish Presidency to ask them for the FTT to be fast tracked and bypass EU27 blockers such as the UK.
• France has passed legislation to implement an FTT of 0.1% on shares at national level, which will come into force in August. This is explicitly proposed by President Sarkozy as a first step towards a broader FTT at EU level. There is nothing in the legislation to link the revenues to development and climate change. The French Socialist candidate Francois Hollande, who is front runner to win the election, has said publicly to spend he would spend a third of an FTT on development and climate change and there was a public commitment from the French Minister for Cooperation to give increasing levels of the FTT to development and climate change from the start of 2013.
• German finance minister Wolfgang Schauble has said clearly that it is unlikely to reach agreement in the Eurozone, and is open to a stamp duty like tax, which includes derivatives as a possible compromise. This would be an FTT by any other name and would raise significant revenue, but it would of course be better if it covered all transactions not just equities. Schauble is now speaking publicly about going ahead this year with the coalition of 9 countries, although there is not a unified German government agreement, as the junior partner, the FDP, remains opposed.
• New research by former JP Morgan city figure Avinash Persaud overrides EC Impact Assessment’s claim that FTT will result in a drop in growth by demonstrating FTT will lead to a rise in growth of 0.25%
• Support for an FTT grows in the US against backdrop of increasing resentment over unemployment, lower than needed growth and the costs of the financial crisis – US Robin Hood Tax campaign to be launched at G8 with Chicago rally of unions and CSOs
• Fast-track to end June: There is a strong likelihood of a European FTT although opposition is fierce– the major challenge is to get a portion allocated to development and climate change.