THE ROBIN HOOD : EVERYTHING YOU NEED TO KNOW

robinhoodtax.org.uk THE BIG IDEA CONTENTS The idea behind the Robin Hood Tax is simple: the financial sector has caused the greatest 01 What is the Robin Hood Tax? recession in a generation, affecting millions of Financial Transaction people here in the UK and around the world. The Why does the Robin Hood Tax campaign favour financial sector must now pay its fair of Financial Transaction Taxes? the cost of sorting out the mess it created. The The Bank Levy Robin Hood Tax campaign is calling on the UK The Fat Tax government to raise an additional £20 billion a year from the banking industry – much needed 02 Why do we need the Robin Hood Tax? revenue that could fight poverty in the UK and How would the money be spent? overseas. It could help tackle climate change. At home Help protect schools and hospitals. Help stop Abroad massive cuts across the public sector. Help build Climate change new lives around the world…so what are we Why should some of this money be used waiting for? for fighting poverty and climate change in developing countries? The tax is just. The financial sector can afford it. And academic heavyweights have shown that 03 the systems are in place to collect it. Why should the financial sector be taxed? How did our financial sector come to be so WHAT’S THIS GUIDE FOR? bloated? This handy guide to the Robin Hood Tax is all you need to make you into a star Merry (Wo)Man. 04 It will tell you everything you need to know and What has the UK government done so far? answer any tricky questions you have about the campaign. 05 Has there been any progress globally?

06 Doesn’t the financial sector make an important contribution to our economy?

07 Can the UK’s banks afford to pay £20 billion extra?

08 What about when people say it needs global agreement to work?

09 Won’t companies just avoid the tax or move their businesses offshore?

10 Won’t banks just pass the costs onto us?

11 Can Financial Transaction Taxes reduce speculation and risky financial activity? • They are simple and inexpensive to implement and difficult to avoid. As described later, whether transactions are carried out on centralised exchanges or spread throughout the world, the vast majority of them are settled through a handful of electronic 01 clearinghouses making such a tax really hard to avoid.4 • There is a large amount of political momentum around FTTs, WHAT IS THE ROBIN HOOD especially in Europe. France, Germany, Spain, Finland, TAX? Austria and Belgium have all come out in support of an FTT. But we are open to a variety of different proposed Robin Hood Taxes, and see levies on profits, remunerations and balance sheets as potentially complementary with each other (and with improved regulation). There are two other taxes which you might also hear about:

THE BANK LEVY This proposal, commonly referred to as the Bank Levy is also known as the Insurance Levy, or by the IMF as the Financial Stability Contribution (FSC). It refers to a flat rate tax on financial institutions above a certain size. The UK  Robin Hood Taxes would be paid by the financial sector. They government announced that it would implement a Bank Levy target those who can afford to pay more. And the money in the Emergency Budget in June 2010, and other countries would be spent on those who need it most – the poor at home have made similar commitments (including Austria, France, and abroad. In the UK additional taxation of the financial Germany, Hungary, Portugal and Sweden). sector must meet two essential criteria to be worthy of the name Robin Hood: Unfortunately these Bank Levies will raise only small sums of money, and critically, none of the money will be earmarked • Any Robin Hood Tax should raise billions of pounds of for helping those most affected by the crisis. In the UK it revenue every year. We call for a further £20 billion from the will raise just £2.5 billion a year from the financial sector. financial sector in the UK. And shockingly, much of this will be offset by a reduction in • Revenue generated by a Robin Hood Tax must be used to Corporation Tax from 28% to 24%. tackle poverty in the UK and abroad and to fight the worst These amounts are tiny in comparison to the implicit subsidy effects of climate change. the banks receive from Government. By refusing to let the We believe that a Financial Transaction Tax offers the most big banks go bust, the UK and other countries ensure that potential – a tiny tax of 0.05% (on average) on transactions the banks can borrow money on far more generous terms such as bonds and derivatives could raise globally as much than other businesses. In the UK, the Bank of England have as £250 billion a year. estimated that this subsidy is worth approximately £100bn a year.5 Even the Financial Times6 is arguing for further taxes FINANCIAL TRANSACTION TAXES on the banks. Financial Transaction Taxes (FTTs) are levied on transactions of financial assets, including , bonds, foreign exchange THE FAT TAX and derivatives. With an FTT, each time a financial product is The FAT tax (Financial Activities Tax) is a charge on financial traded, a tiny percentage (between 0.5% and 0.005%) of the sector profits and remuneration. It was first proposed by the value of the is collected in tax. IMF in its influential June 2010 report, A Fair and Substantial Contribution by the Financial Sector. The IMF proposed WHY DOES THE ROBIN HOOD TAX CAMPAIGN such a tax because it would correct what it called an “under- FAVOUR FINANCIAL TRANSACTION TAXES? taxed and hence perhaps ‘too big’” financial sector. It is also supported by the and the UK The Robin Hood Tax campaign believes FTTs are the most government. appropriate way to tax the financial sector. Here are four reasons why: According to the IMF, a FAT tax of 10% (half the rate of VAT) could raise about £9bn in the UK. • They have the greatest potential to raise revenue. Implemented internationally, Financial Transaction Taxes So what’s the rationale for an organisation like the IMF could yield as much as £250 billion annually, while in the UK suggesting a new tax on the banks? we could raise tens of billions of pounds a year.1 Somewhat incredibly, whilst VAT goes up for ordinary • FTTs are commonplace and have been implemented either people, the financial sector remains VAT exempt. That means permanently or temporarily in at least 40 countries over every time you buy a car, you pay VAT. Every time a trader many decades.2 In the UK, we have an FTT on some share sells a or , they pay nothing. This means a transactions of 0.5%, which raises around £4 billion a year.3 staggering loss in that instead helps to boost FTTs on a broader range of financial products could raise bank profits and pay. significantly more. an estimated 30 to 50 thousand extra infants died in 2009.9 The World Bank estimates that, globally, an additional 120 million people have been forced to live on less than US$2 a day and an additional 89 million on less than US$1.25 a day.10 02 The Millennium Development Goals are now in jeopardy as governments struggle to live up to their foreign aid WHY DO WE NEED THE commitments. Tony Dolphin, senior economist at the Institute for Public Policy Research, explains: ‘Although the worst of ROBIN HOOD TAX? the crisis appears to be in the past, its effect on emerging and developing economies will continue well into the future. Lower HOW WOULD THE MONEY employment rates and a lack of social safety nets mean BE SPENT? that poverty is higher than it would otherwise have been and achieving the Millennium Development Goal of halving poverty by 2015 will be that much harder.’11 This crisis was caused by the financial sector and it needs to pay to fix the problems it helped create.

CLIMATE CHANGE A tragic parallel between climate change and the financial The financial crisis and recession have left a massive hole in crisis is that those least responsible suffer the most. While the UK’s public finances, hitting front line services and jobs. rich countries and powerful corporations, many with ties to The largest recession of a generation has had a disastrous the financial sector, have produced most of the greenhouse impact not just in the UK, but on the public finances of many gases that are causing climate change, poorer countries are developing countries as well. Hundreds of thousands of expected to bear 75-80% of the costs.12 Disrupted seasonal supporters of the Robin Hood Tax campaign believe that patterns lead to failed crops, and increased floods, droughts, banks, hedge funds and the rest of the financial sector should cyclones and storms lead to severe hunger, poverty, be asked to pay their fair share to clear up the mess they disease, and lost homes. According to The Stern Review helped create. We are calling on the UK financial sector to pay of the Economics of Climate Change, there could be up to an additional £20 billion per year in taxation. Globally, we are 200 million environmental refugees by 2050.13 Insurance calling for Robin Hood Taxes to raise as much as £250 billion giant Munich Re estimates that losses from climate-related per year. Our proposal is that the money be split as follows: catastrophes have increased 10% since 1980, and averaged • 50% to be used to protect the poorest and most vulnerable at $100 billion per annum over the last decade.14 The costs fall home; disproportionately on developing countries, which are less equipped to deal with catastrophes, and in which agriculture • 25% to be used to help those in developing countries hit – particularly subsistence agriculture – constitutes a significant hardest by the financial crisis; proportion of GDP. • 25% towards much needed resources to fight climate change A Robin Hood Tax would provide a new source of finance at home and abroad. to help those experiencing climate change deal with its Here’s why we need the Robin Hood Tax: devastating effects.

AT HOME WHY SHOULD SOME OF THIS MONEY BE USED FOR FIGHTING POVERTY AND CLIMATE CHANGE The banking crisis has hit people in the UK hard. They are losing IN DEVELOPING COUNTRIES? their jobs, crucial services and most alarmingly their homes. Youth unemployment is sky-rocketing. According to Save the Research for Oxfam has shown that the 56 poorest countries Children, 1.7 million children in the UK live in severe poverty, are facing a $65 billion dollar hole in their finances because of which means living without basic necessities such as clothing the financial crisis caused by the banks. This means cuts in and food.8 This year, the UK government has announced plans education health and support for farmers. In desperately poor to cut £81 billion from the national budget through to 2015. countries, that means people losing their lives. So a tax on These cuts will push people further into debt and deeper into the banks should help those hit by the financial crisis in poor poverty. A Robin Hood Tax offers an alternative to the cuts. countries as well as the UK. At the same time rich nations, who did the most to cause climate ABROAD change, have promised to find $100 billion dollars to help poor The consequences of the financial crisis have been serious countries who are hit hardest by its consequences. It makes in the UK and the developed world, but they have been even sense for the financial sector to contribute to the urgent financing worse in more vulnerable countries that did nothing to cause it. required to fight climate change, a point recognised by both As a direct result of the crisis, developing and emerging country Germany’s Chancellor Merkel and France’s President Sarkozy. output, , migrant remittances, capital inflows, and foreign It is for these reasons that we think that half the money raised aid have all been lower than expected over the last three years. should be spent helping the poorest in developing countries and On the ground, the effect is devastating. In Sub-Saharan Africa, fighting climate change at home and abroad, and the other half spent in the UK. or casino-style banking, which increases volatility in the financial markets (see below for more on this). Globally, the volume of financial trade weighs in at a colossal US$3,260 trillion – 73.5 times the size of nominal world GDP. This ratio is highest in the UK, where in 2007 the volume of financial transactions reached 03 a staggering 446 times the size of our real economy.17 Our over- WHY SHOULD THE reliance on the City of London is also the reason why the impact of the recession in the UK was so savage. FINANCIAL SECTOR BE HOW DID OUR FINANCIAL SECTOR COME TO TAXED? BE SO BLOATED? Part of it, according to the IMF, is that the financial sector is “under-taxed”18 relative to the rest of the economy. Unlike normal goods and services such as a car, or a plumber, financial sector goods and services are not subject to VAT. Because of this exemption, the IMF argues that the financial industry has an advantage over the rest of the economy and that money has been directed to it and away from other sectors. They conclude that “the financial sector may be… 19 Not only is the financial sector the most able to pay (and ‘too big’”. Even Lord Turner, Chairman of the Financial currently under-taxed), but it is also the same sector that got us Services Authority has called the sector ‘swollen’. into trouble in the first place. The financial sector precipitated Yet the UK government has not implemented the financial the financial crisis and the largest recession since the 1930s. sector taxes recommended by the IMF and the European Numerous financial institutions exploited their too-big-to-fail Commission. Instead, it announced swingeing spending cuts status and engaged in risky behaviour that took our economy and a rise in VAT to 20%. A hike in VAT hits the poor hardest, to the brink. Through the bank bailout, UK taxpayers effectively because with less income, a higher proportion of their income underwrote the financial sector’s get out of jail free card. The is spent on consumption.20 Furthermore, a rise in VAT will tilt IMF has calculated that the un-recovered cost to the UK of our fiscal imbalance even further in favour of the financial the bank bailout was ₤99 billion1, the cost to the UK economy sector at the expense of the rest of the economy. as a whole of the financial crisis in terms of lost output will be ₤497 billion, and the resulting increase in government debt The Robin Hood Tax campaign believes that rather than over the period of 2008-15 will be ₤737 billion.15 This money punishing ordinary people for the financial crisis, we should is now spurring a rapid return to record breaking profits and be looking to the very sector that got us into this mess to bonuses for the banks. According to the Governor of the help get us out. So far the government has implemented a Bank of England, Mervyn King, “never in the field of financial disappointing Bank Levy that will eventually generate only endeavour has so much money been owed by so few to so £2.5 billion a year in the UK (and be partially offset by the many”.16 government’s decision to reduce corporation tax from 28% to 24%). The Robin Hood Tax campaign is calling on George In the last two decades the financial sector has undergone Osborne to implement financial sector taxes of £20 billion a runaway expansion with its activities becoming steadily more year in the UK. By comparison, the global profits and bonus divorced from the real economy of goods and services. Much of pot for 2010 is likely to have been between $600 billion and a the excessive growth is from speculative “high frequency trading” $1,000 billion (a trillion) dollars.21 04 05 WHAT HAS THE UK HAS THERE BEEN ANY GOVERNMENT DONE SO PROGRESS GLOBALLY? FAR?

Chancellor George Osborne introduced a Bank Levy in January The popular momentum behind the campaign has helped 2011 but it misses the mark as it will only raise £2.5 billion make financial sector taxes a mainstream political issue annually, and doesn’t ring fence any money to help the people around the world. In a report in June 2010, the IMF hit hardest by the financial crisis. Reductions in corporation tax acknowledged that the financial sector was “under-taxed” and mean the actual revenue collected is even lower. urged governments to implement new financial sector taxes. This is nowhere near enough. So, based on research as In Europe, several countries have come out in support to how much it can afford to pay, we are calling on the of a Financial Transaction Tax. President Sarkozy has Chancellor to tax the UK’s financial sector by an extra £20 outlined that financial sector taxes are at the top of France’s billion a year. agenda for its presidency of both the G8 and , and has commissioned to write a report investigating them One of the reasons the government has not done more is and other forms of innovative finance for development.. The the immense power of the City of London in lobbying and German government is already planning to introduce an FTT in influencing politicians. That is why huge public pressure is 2012 or 2013, and countries including Spain, Finland, Austria needed to convince the government it is more costly to ignore and Belgium are also in favour. The has the people than to ignore the banks. also voted in favour of introducing a European-level FTT and there is a real possibility that there will be an agreement on an FTT within Europe by the end of the year. A large number of developing countries also support an FTT. Brazil and South Africa have implemented their own Financial Transaction Taxes, while the South African Finance Minister has said he is in favour of a European-level FTT. At the 2011 Spring Meetings of the International Financial Institutions, 20 low-income Francophone countries said they support a broad-based FTT. The Robin Hood Tax campaign ultimately wants to see a Financial Transaction Tax introduced that would raise money from the financial world and curb the worst aspects of its behaviour. High frequency trading (HFT) has developed to such an extent that dealers such as those from Tradebot in 06 the US hold a on average for just 11 seconds.22 These purchases aren’t made like normal business decisions because DOESN’T THE they take no account of the fundamental determinants of a stock’s worth, but instead try to second-guess other market FINANCIAL SECTOR participants’ actions and benefit from tiny movements in price. MAKE AN IMPORTANT Computer programs trade and sell large volumes in very short time periods, generally milliseconds or microseconds CONTRIBUTION TO OUR (one millionth of a second). “Tens of thousands of are executed by these trading machines in the blink of an eye,” ECONOMY? explains Martin Wheatly, CEO of the Securities and Future Commission in Hong Kong and former deputy chief executive of the London Stock Exchange, “There are some estimates that HFT now represents 60-70 per cent of the trading volume in the US market.”23 A similar picture exists here in the UK. Beyond contributing little value to the real economy, HFT Absolutely, it accounts for about 8% of UK GDP. A healthy also increases volatility, as traders make large gambles on and robust financial sector is essential to our society’s very small changes in the market. This volatility is illustrated well-being as it lends to businesses and individuals and best by the “flash crash” of May 6, 2010 when a trader sold provides high street banking services. However, unfettered 75 thousand stocks worth USD 4.1 billion in 20 minutes. The by regulation, a distinct area of the financial sector – namely sudden drop in value spurred high frequency traders to go casino-style trading, the worst of which is the high frequency into a spiral of selling, causing US stock prices to plummet, trading – has grown out of control. Lord Turner, Chairman of some down to a cent, and then rebound within minutes. the Authority, has questioned this area’s Many serious commentators have highlighted the dangers of contribution, calling the sector ‘swollen’ and ‘socially useless’. this process, and have called for an FTT to calm this frenzied By taxing this area of business we can raise much needed whirlpool of transactions. This includes Martin Wheatley, the revenue and help to rebalance our economy away from our new head of the Consumer Protection and Markets Authority over-reliance on the City of London. and Lord Turner, head of the Financial Services Authority.24 07 08 CAN THE UK’S BANKS WOULD THIS ONLY WORK AFFORD TO PAY £20 IF ALL COUNTRIES ACTED BILLION EXTRA? TOGETHER?

Firstly, we are asking for a fairer contribution from not just International agreement would be great, but we don’t banks but from the entire financial sector – that’s hedge have to wait. At least 40 countries around the globe have funds, asset managers and the rest. Furthermore, the Bank implemented Financial Transaction Taxes on their own.28 The of England have estimated that by underwriting the banks, UK has a long and commendable history of spearheading the Treasury provides them with an implicit subsidy worth new approaches to financial sector taxation, including a approximately £100bn a year.25 It’s clear that the banks are FTT on share transactions, known as the Stamp on under-taxed (the IMF agrees), and as a result there is plenty shares. The 0.5% yields £4 billion a year and of spare money sloshing about in the financial sector as their hasn’t stopped the London Stock Exchange being one of latest round of bonuses shows. They can easily afford to pay the most profitable markets in the world. More recently the their way. UK government pressed ahead with France and Germany to implement the £2.5 billion bank levy. Momentum is The UK financial sector’s income chargeable to tax could building behind an EU-wide FTT, but it is entirely possible for reach £75 billion in 2011, 25 per cent higher than in 2007-08. countries to lead with unilateral action. The IMF conclude that Bonus payments could be as much as £7 billion in the same FTT’s “do not automatically drive out financial activity to an year, making a total of more than £80 billion.26 But the true unacceptable extent”.29 total is much, much higher once you include, for example, hedge funds that are registered in the Cayman Islands and trading in the UK. These funds are notoriously secretive, but in just six months the ten leading hedge funds alone made $28bn for their customers in the second half of 2010.27 Add to this commonly used ‘creative’ accounting techniques, and it is clear that the financial sector’s true total profit is many tens of billions higher. It can easily afford another £20 billion. When looking at taxes you have to compare like with like. Consider what taxes you have to pay. is paid on everything you earn. The equivalent of income tax for the financial sector is corporation tax (which will be reduced from 28% to 24% as a result of the 2010 Emergency Budget). You also pay VAT on most goods and services that you buy (which was increased in January 2011 to 20% from 17.5%), yet incredibly the financial sector remains VAT exempt. Each time a financial good or service is bought not a penny of VAT is paid. 09 WON’T COMPANIES JUST AVOID THE TAX OR MOVE THEIR BUSINESSES OFFSHORE?

Critics of the FTT often say it will lead to a mass exodus from the City. This claim is unsubstantiated and overblown. It is used as a bargaining chip by the banks to cajole the government into not acting. Before looking at the details, to illustrate this, here’s an anecdote: Terry Smith, head of Tullett Prebon, a City broker, famously said in December 2009 that he would allow any of the company’s 950 London-based staff to move overseas before the Labour governments one-off 50% supertax on bonuses over £25 thousand came into force in December 2009. reported on 14 April 2010 that so far ‘none … have taken him up on the offer.’30 Even the has argued that banks threats to leave “should be faced down, not just because they are unreasonable but because they are of questionable credibility”.31 centre will still be needed in Europe. Germany, the main FTTs are commonplace and have raised billions of dollars of competitor in the European time zone is already committed to predictable revenue without serious avoidance. As stated by implementing an FTT. the IMF, FTTs (which it calls STTs) “are certainly feasible as Ideally Robin Hood Taxes would be implemented witnessed by their use in numerous developed countries. The internationally. However, in working towards an international fact that major financial centers such as the UK, Switzerland, consensus, individual countries, or regions like the EU, Hong Kong, Singapore, and South Africa levy forms of STTs can and should take the lead by unilaterally implementing indicates that such taxes do not automatically drive out Robin Hood Taxes within their own market, especially as the 32 financial activity to an unacceptable extent.” evidence so far shows that this will not result in a mad dash The lack of avoidance stems from the multiplicity of reasons of capital out of the countries that are implementing a tax on for which investors trade in a particular location – reasons that their financial sectors. hold more significance than the domestic tax regime. Consider Global currency markets, the largest financial market in the the advantages gained by investors from being concentrated in world at $4 billion per day, in which speculators have been one marketplace with immediate access to information, support free to reap huge profits at the expense of wider society, offer services, and trading partners. The gains from these so-called a clear first step for FTT implementation. Every high value network externalities greatly outweigh the potential burden Sterling transaction, no matter where in the world it takes from Robin Hood Taxes, and would mitigate any incentive for place – New York, Johannesburg, or Timbuktu – is settled via firms to move to an untaxed location in the case of unilateral the Continuous Linked Settlement (CLS) Bank, making a FTT implementation. And of course, banks need to locate in a on currency transactions impossible to avoid. But even with country with a big enough budget to bail them out if things go other Robin Hood Taxes, the assertion that they will lead to a wrong. There are not many governments with the ability or mass exodus is unfounded. willingness to provide this implicit guarantee, certainly not the For example, the UK’s existing stamp duty on share Cayman Islands or even Switzerland. purchases applies to all trading in shares listed in the UK, no Furthermore, time zones are critical for financial transactions, matter where the trade takes place. If a share of a company with London being ideally situated between the Asian and listed in London changes hands anywhere in the world, then US markets. This means that banks and other financial UK stamp duty is payable. Moving your trading business out institutions cannot all move to New York as a major financial of the UK doesn’t help you avoid the tax. 10 11 WON’T BANKS JUST PASS CAN FINANCIAL THE COSTS ON TO US? TRANSACTION TAXES REDUCE SPECULATION AND RISKY FINANCIAL ACTIVITY?

Robin Hood Taxes are designed to specifically target the In recent years there has been an explosion in high frequency excessive profits, bonuses, and risky behaviour in the trading - transactions that happen every few seconds. There financial sector, whilst protecting the investments of ordinary has also been a huge increase in the trading of derivatives, people and businesses. The IMF have suggested a Financial making the volume of financial transactions increase to more Transaction Tax would be highly progressive.33 than 70 times the size of the world economy. Many serious commentators believe this volume is dangerously large and The Robin Hood Tax campaign calls first and foremost for a de-stabilising, and that many of these transactions are, in Financial Transaction Tax, because the burden would fall on a the words of Lord Turner, chair of the Financial Services distinct area of financial sector operations that is far removed Authority, ‘socially useless’. from the average consumer: casino-style trading. Many of the most speculative, risky and socially useless Hedge funds, investment banking divisions of large banks transactions are based on very small profit margins, meaning and dedicated investment banks dominate this market and so that even at a very low rate such as 0.05%, an FTT would incidence of an FTT would fall primarily on these companies shrink the size of the market by removing the incentive to and corporations. Even if these institutions did manage to trade. Many economists support the FTT for this reason. pass the costs onto their customers, the customer-base of hedge funds and investment banks is comprised primarily of The Robin Hood Tax campaign principally supports an FTT high net worth individuals, and not ordinary people like you because of the money it will raise to help the poor. However, and me. if it also acts to reduce risky gambling and make the world economy safer that can only be a good thing. Financial services commonly used by businesses and ordinary people, such as retail banking services, pension funds, and insurance are a completely distinct area of business and would be relatively unaffected by an FTT implemented at a very low rate (0.005-0.5%) because these types of transactions are much less frequent. Institutional investors, including pension and insurance funds, tend to turn over their portfolios only once a year.34 Compared to other potential tax increases, Robin Hood Taxes would impact much less on the ordinary person. Unlike VAT, which is regressive because the poor spend a greater proportion of their income on consumption than the rich, Robin Hood Taxes are progressive. Even if the banks attempt to pass the tax on, the rich allocate much more of their income to financial services. It is thus imperative that the UK government refrain from cutting essential social services and taxing the poor, and instead implement these much fairer methods of taxation to fill the hole in public finances. 12 ENDNOTES

1. McCulloch, N., and Pacillo, G., 2010. The – A Review of the Evidence. Institute of Development Studies. University of Sussex, UK

2. Financial Transaction Taxes have been implemented in Argentina, Australia, Austria, Belgium, Brazil, Chile, China, Colombia, , Ecuador, Finland, France, Germany, Greece, Guatemala, Hong Kong, India, Indonesia, Ireland, Italy, Japan, Malaysia, Morocco, Netherlands, New Zealand, Pakistan, Panama, Peru, Philippines, Portugal, Russia, Singapore, South Africa, South Korea, Sweden, Switzerland, Taiwan, UK, US, Venezuela and Zimbabwe. See Pollin, R. 2005. ‘Applying a Securities Transaction Tax to the US. Design Issues, Market Impact, and Revenue Estimates,’ in Epstein G (ed) Financialization and the World Economy. Edward Elgar

3. European Commission. 2010. Financial Sector Taxation. Commission Staff Working Document. Brussels, Belgium.

4. Leading Group on Innovative Financing for Development, 2010. Globalizing Solidarity: The Case for Financial Levies. Also Schmidt, R. 2010. The Financial Transaction Tax: Feasibility of taxing OTC derivatives transactions. The North-South Institute. Forthcoming.

5. Bank of England, June 2010. Financial Stability Report.

6. http://www.ft.com/cms/s/0/72402fea-2d6f-11e0-8f53-00144feab49a. html#axzz1GwrPQXT0, accessed on 18th March 2011

7. Save the Children, February 2011, Severe Child Poverty: Nationally and Locally

8. Dolphin, T., and Chappal, L. 2010. The Effect of the Global Financial Crisis on Emerging and Developing Economies. Institute for Public Policy Research. London, UK

9. Friedman, J., and Schady, N. (2009) How Many More Infants Are Likely to Die in Africa as a Result of the Global Financial Crisis? Policy Research Working Paper 5023. World Bank. 22. http://dealbook.nytimes.com/2010/05/17/speedy-new-traders-make-waves-far-from-wall-st/ Washington DC, USA 23. Wheatley, M. 2010. ‘We need rules to limit the risks of superfast trades.’ Financial Times. 10. Ravallion, M. 2009. The Crisis and the World’s Poorest, Development Outreach. World Published 20 September 2010 on FT.com Bank Institute. Washington DC, USA 24. http://www.ft.com/cms/s/0/ad7f31f6-c4cd-11df-9134-00144feab49a. 11. Dolphin, T., and Chappal, L. 2010. The Effect of the Global Financial Crisis on Emerging html#axzz1H9xo7RF3, and http://www.fsa.gov.uk/pages/Library/Communication/ and Developing Economies. Institute for Public Policy Research. London, UK Speeches/2011/0218_at.shtml

12. The World Bank Group, World Development Report 2010 25. Bank of England, June 2010. Financial Stability Report.

13. Stern, N. 2006. The Stern Review on the Economics of Climate Change. HM Treasury. 26. Source: http://www.guardian.co.uk/politics/2011/jan/10/banks-unlimited-bonuses- London, UK ministers. Accessed on 7/4/11

14. Munich Climate Insurance Initiative. 2009. Climate Risk Management Mechanisms 27. Source: http://www.guardian.co.uk/business/2011/mar/02/hedge-funds-bounce-back- including Insurance, in the context of Adaptation to Climate Change. Submitted to the on 79bn-pounds-profit. Accessed on 7/4/11 UNFCCC 24 April 2009 28. Financial transaction taxes have been implemented in Argentina, Australia, Austria, 15. The IMF says the cost of the bailout to the UK was 5.4%, that the advanced G20 economies Belgium, Brazil, Chile, China, Colombia, Denmark, Ecuador, Finland, France, Germany, will see an increase in debt of 40%, and that the countries ‘that experienced a systemic crisis’ Greece, Guatemala, Hong Kong, India, Indonesia, Ireland, Italy, Japan, Malaysia, Morocco, [confirmed by the IMF as the UK, US and Germany] will experience an eventual overall loss of Netherlands, New Zealand, Pakistan, Panama, Peru, Philippines, Portugal, Russia, output equivalent to 27% of GDP. UK GDP in 2008 was 2, 674 billion dollars. Singapore, South Africa, South Korea, Sweden, Switzerland, Taiwan, UK, US, Venezuela and Zimbabwe. See Pollin, R. 2005. ‘Applying a Securities Transaction Tax to the US. 16. http://www.independent.co.uk/news/business/news/mervyn-king-never-has-so-much- Design Issues, Market Impact, and Revenue Estimates,’ in Epstein G (ed) Financialization money-been-owed-by-so-few-to-so-many-1806247.html; accessed on 21/3/11. and the World Economy. Edward Elgar

17. Schulmeister, S. 2009. A General Financial Transaction Tax: A Short Cut of the 29. Claessens, S., Keen, M., Pazarbasioglu, C. 2010. Financial Sector Taxation. The IMF’s Pros, the Cons, and a Proposal. Working Paper No. 344. Östreichisches Institut Für Report to the G-20 and Background Material. International Monetary Fund. Washington DC, Wirtschaftsforschung. USA

18. Claessens, S., Keen, M., Pazarbasioglu, C. 2010. Financial Sector Taxation. 30. Teather, D. 2010. ‘City veteran Terry Smith pockets £4m bonus.’ Guardian. Published 14 The IMF’s Report to the G-20 and Background Material. International Monetary Fund. April 2010 on guardian.co.uk Washington DC, USA 31. http://www.ft.com/cms/s/0/2e6ba9a6-49bd-11e0-acf0-00144feab49a. 19. Claessens, S., Keen, M., Pazarbasioglu, C. 2010. Financial Sector Taxation. html#axzz1G7ES1kdG, accessed on 9/3/11. The IMF’s Report to the G-20 and Background Material. International Monetary Fund. Washington DC, USA 32. Claessens, S., Keen, M., Pazarbasioglu, C. 2010. Financial Sector Taxation. The IMF’s Report to the G-20 and Background Material. International Monetary Fund. Washington DC, 20. VAT takes up 12.1% of the income of the poorest 20%, compared to 5.9% of the richest USA 20%. Barnard, A. (2009) The effects of taxes and benefits on household income, 2007/08, Economic & Labour Market Review, Vol. 3, No 8, August 2009, 33. Claessens, S., Keen, M., Pazarbasioglu, C. 2010. Financial Sector Taxation. The IMF’s Report to the G-20 and Background Material. International Monetary Fund. Washington DC, 21. Estimates from Murphy, R, Taxing Banks, http://www.taxresearch.org.uk/Documents/ USA IMFTaxingBanks.pdf and Kapoor, S. (2010) Financial Transaction Taxes: Tools for Progressive Taxation and Improving Market Behaviour, http://robinhoodtax.org.uk/files/ 43. Kapoor, S. 2010. Financial Transaction Taxes: Tools for Progressive Taxation and ReDefine-FTTs-as-tools-for-progressive-taxation-and-improving-market-behaviour.pdf Improving Market Behaviour. Re-Define.