Today is Day One of France’s new financial transactions tax (FTT). The 0.2% tax is expected to raise half a billion euros in the first year, with a pledge from President Hollande that a part of the revenue will go towards combatting AIDS. This is a huge step forward for the Robin Hood Tax campaign and the great efforts of our sister organisation in France: Robin des Bois.
Former French President Sarkozy first proposed the tax at a rate of 0.1%. However, as soon as President Hollande took office, he doubled it to 0.2% - promising some of the revenue to development with the exact allocation being finalised this autumn. This initial step by France heralds a more ambitious FTT that nine European countries - including Germany, Spain and Italy - plan to implement by the end of 2012.
The UK Government is standing firm in its opposition to the Robin Hood Tax, though in fact the French FTT is modelled on the UK's own 0.5% FTT on shares (the Stamp Duty), which brings in over £3billion every year. Curiously, the UK Government rarely mentions the Stamp Duty - perhaps as it undermines their arguments against the FTT.
By taking such a lead with this tax, France is signalling the direction of travel following the economic crash that is still affecting us – that the financial sector has to pay a greater share in taxation from now on. With this progress, surely it is time for the UK Government to rethink its position on the FTT. It should join with other leading European countries and extend its FTT on shares to other assets, which would bring in an additional £20 billion a year. An amount the City can afford and ordinary people at home and abroad desperately need.