Sarkozy set to introduce Tobin Tax

Posted on January 31, 2012

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written for New Statesman – words by Robert Pollard

French President ready to implement a financial transaction tax and hopes move will encourage other countries to follow.

Nicolas Sarkozy is ready to resist pressure from France’s finance sector and introduce a 0.1 per cent tax on financial transactions.

The French president proposes to introduce the ‘Tobin Tax’ regardless of whether other EU countries do the same, saying he hopes the decision will encourage others to follow suit. He believes that the measure will improve the economic difficulties facing France.

What we want to do is create a shockwave and set an example that there is absolutely no reason why those who helped bring about the crisis shouldn’t pay to restore the finances

We hope the tax will generate €1bn (£800m) of new income and thus cut our budget deficit.

Some in France believe the move is purely political. With the French elections looming, and Sarkozy trailing socialist candidate Francois Hollande in the polls, many French commentators believe this to be a move aimed at improving his own ratings.

Here in the UK, David Cameron has continually refused to embrace the Tobin Tax, claiming that worldwide implementation would be the only way of making the tax a success.

A spokesman for the UK arm of the Robin Hood Tax campaign said:

Sarkozy has shown he is capable of reining in the banks and ensuring they pay more in tax. Why then is David Cameron so resistant when the idea is backed by the British people?

If he’s serious about us ‘all being in this together’ he needs to get on and introduce Britain’s own tax to make banks pay their fair share.

Sarkozy’s decision will place further pressure on Cameron to adopt the tax in Britain. Labour’s Ed Miliband, a known advocate of the tax, may see this as an opportunity to press the Prime Minister on the issue.

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Posted in: Business, Politics