News – 11 July 2011

The Tobin Tax

The Council of Australian Humanist Societies calls on the federal government to institute a Tobin tax on each foreign currency transaction made by Australian banks. The amount taxed need be no more than 0.05% of the amount transacted; the revenue to be deposited into a special trust fund for foreign aid projects. It is said that the Australian Treasurer is not keen on the idea.

According to Dr Alan McPhate, Outstanding Humanist Achiever for 2009:

… the Tobin Tax proposal has progressed slowly over the last twelve months. A group calling themselves the ‘Robin Hood Group’ is still attempting to progress the proposal with limited success.

A group of Treasurers of some twenty-six countries has met on a number of occasions and has considered the proposal (supported by a number of European countries but not officially adopted). Australia’s Treasurer is not keen on the idea of a Tobin Tax but has not commented publicly (to my knowledge).

It is said that he is seeking to establish Australia as the Financial Centre for Asia and feels that a Tobin Tax would make this proposal less likely. Following the world financial crisis and the effect this had on the financial centres of New York, London and Europe,  I would think that many people would consider we could do without Australia becoming a Financial Centre.