European Study Raises Hope for Tobin Tax

BRUSSELS, Belgium, SEPT. 24, 2001 ( A tax plan aimed at discouraging speculation on the world´s foreign exchanges received a big boost over the weekend when the European Commission undertook a study into the feasibility of introducing a new levy, the Guardian newspaper of London reported.

Print Friendly, PDF & Email
Share this Entry

With the financial markets in turmoil, Germany and France pushed for measures that would curb excessive and damaging volatility at the meeting of European Union economics and finance ministers.

Officials at the commission will prepare a report for the meeting of the European Council in Ghent in December, assessing the way in which the so-called Tobin tax — named after Yale economics professor James Tobin — could be introduced.

With at least $1.5 trillion passing through the foreign exchanges every day, a Tobin tax set at only 0.1% would, in theory, raise $7.5 billion a week.

British Chancellor Gordon Brown backed the investigation but insisted that it should be part of a wider study into globalization and the financing of development.

Treasury officials said that the British government supported the idea of a Tobin tax, which could raise billions of pounds a year to increase aid to the world´s poorest countries, but believed that there were practical problems of implementation to be overcome.

Print Friendly, PDF & Email
Share this Entry


Support ZENIT

If you liked this article, support ZENIT now with a donation