Robin Hood Tax: I’m a merry man

In any other election, the eye-catching campaign for a ‘Robin Hood Tax’ would have caught the public imagination. But there has been so much drama, so many surprises and — since yesterday — such serious gaffes that this has been pushed down the agenda. And that’s a pity.

OK, so the Robin Hood Tax is a re-branding of a old proposal, the Tobin Tax named after the American economist who first proposed it in 1972. It’s a levy of a fraction of a per cent on every financial spot transaction, with the money raised intended to combat poverty.

OK, it’s controversial. Many journalists, and some economists, have thrown cold-water over it, particularly in the right-wing press. They say that it will hurt the poor by adding costs to transactions. Perhaps it concerns them more that they claim it will damage banks’ profitability.

OK, it can’t happen with a click of the fingers. To work properly, avoiding gaping loop-holes, it will need to be by international, cross-currency agreement.

BUT IT’S STILL A CAPTIVATING IDEA.

I’m under no illusions about the difficulties and the opposition the proposal will face but that’s no reason to fight shy of it. As the future of our finance sector is rightly at the centre of debate right now, this is precisely the time to have this proposal considered seriously and openly.

So, I’ve signed up to Robin’s band. I see I am the 46,000th person to do so (do I get some sort of prize? 0.005% of a chocolate button?).

And I’ll add what I see as essential first steps to getting a workable Tobin tax:

1. An agreement on the ring-fencing of the money raised — I personally would want to see it spent on international development, including mitigation of climate change. Others round the table might want it used for different purposes, but let’s have that discussion now.

2. Any agreement has to be international — it’s only through making this part of worldwide regulation that we are really going to get this work. We don’t want it to be yet another stipulation that financiers see as a challenge to their ingenuity in avoiding.

3. International agreement is much more likely now than it was a few weeks ago following the IMF’s proposals for taxing banks. The Tobin Tax needs to be thrown into that equation now and considered alongside the other proposals, as part of an overall package.

But none of this should be used as a recipe for delay: the extra funding to fight global poverty is needed urgently. Yes, there will be interminable meetings round oversized tables in anonymous conference centres, but a timetable for decision, in my own opinion, is essential.

In the meantime, we need to set about reforming our own banks in Britain, and making them once more safer institutions which give back to society. I’m proud that my party has got hard-nosed proposals to do that. I am also proud that my party has said in the Liberal Democrat manifesto that we support the principle of the Tobin Tax. Robin Hood’s men and women have swapped their clothes and are in head-to-toe in orange nowadays.