Urge the Chancellor to implement the first Robin Hood Tax – response report

This action is now finished.

What happened?

Between March 19 and March 23 2010 over 3400 people wrote to the British Chancellor of the Exchequer Alistair Darling urging him to implement a tiny currency transaction tax on sterling in his pre-election Budget. These messages were also forwarded to Parliamentary election candidates in the writer’s constituency meaning more than 10,000 messages were sent at both national and local level in 5 days.  The response from politicians and hopeful candidates was immediate. During that period the UK Treasury responded with a message to campaigners, there was significant political movement from the opposition on the issue of bank taxes.  Media coverage was extensive too.

Thank you all so much for taking action – it has applied significant pressure and brought the Robin Hood Tax to the top of the political agenda.

Letter to the Editor: Read the Robin Hood Tax campaign’s response to the Budget >>

Action details

For reference, the letter sent by 3203 supporters to the Chancellor and election candidates read:

Please implement a unilateral sterling transaction tax in your budget.

Dear Mr Darling,

Like many of the tens of thousands of supporters of the Robin Hood Tax I will be looking closely at your budget.  I hope you are not planning any measures that would mean people like me will again have to bear the brunt of paying down the deficit.

I strongly believe a tiny tax on major financial transactions is the fairest way to address the economic challenges we face. You could start on March 24th by putting a small tax on sterling currency transactions. This would hit multi-million pound trades by banks, not people’s holiday money. It could raise at least £3 billion every year to deal with the budget deficit, and provide extra money to address poverty and climate change. The UK’s leadership would also pave the way for other Robin Hood taxes at a global level.

The Treasury’s response at http://www.hm-treasury.gov.uk/global_tax_campaign_information.htm demonstrates that you are taking my views seriously. I am encouraged. To be clear: what I urge you to consider here is a unilateral sterling currency transaction tax in the Budget ahead of further international negotiation. I am not discussing an “insurance levy” in this instance.

Last year we all bailed out the banks and for many of them the worst has passed. But for people in the UK and around the world, the financial crisis is far from over.  It’s time for those who caused the crisis to take greater responsibility in putting our public finances right. I hope your budget will reflect this and that you will introduce the first Robin Hood Tax, on sterling.

A copy of this message has also been sent to the prospective parliamentary candidates in my constituency.

You may be interested to see how other MPs and candidates are engaging with us at http://robinhoodtax.org.uk/your-action/

This was followed by a further 266 supporters sending the following message of clarification:

Re. The Robin Hood Tax. Thank you for your response.

Dear Mr Darling / HM Treasury

I have written to you previously about implementing a tiny sterling currency transaction tax in next week’s Budget. The Treasury response at http://www.hm-treasury.gov.uk/global_tax_campaign_information.htm was encouraging. Thank you for engaging with me and the thousands of others who believe in this idea.

While it is clear that many of the proposals made by the Robin Hood Tax Campaign will require international support and co-ordination please note that in this instance I was suggesting a unilateral tax on sterling. Please also note that I am not discussing an ‘insurance levy’ or similar.

Ideally I would like to see an international system of transaction taxes, but there is no need to wait. A 0.005 per cent tax on sterling currency exchange (just 5p for every £1000 of transactions) would raise a minimum of £3 billion per year.  The tax should be designed to hit the 60-80 largest financial institutions that participate in wholesale trading of currencies. The tax should not affect the retail market of ordinary consumers buying currency to go on holiday.  It is a fair proposal and one that I believe you should seriously consider.

To ensure all those who wish to represent me are aware of my views a copy of this message has been sent to registered PPCs in my constituency.

You may be interested to see how other MPs and candidates are engaging with us at http://robinhoodtax.org.uk/your-action/

The following ‘key facts’ were provided to inform supporters exactly what they were asking for.

This tax would raise a minimum of £3 billion every year.  It would start to make banks and finance houses contribute to the costs of clearing up the damage caused by the economic crash, and set up a continuing source of income that could be used for good causes both here and abroad.

The rate of 0.005% is easily affordable by big banks and hedge funds that trade currencies. The tiny rate of the tax is too small to cause disruption to the market . It would not damage UK trade or business in the City of London.

The proposal is entirely feasible because in recent years the foreign exchange markets  (ie the trade in currencies such as the dollar, pound, euro and yen) have become automated. Transaction taxes can be collected at the point when deals are settled. Computerisation means revenue collection is straight forward and inexpensive.

The tax is designed to hit the 60-80 largest financial institutions that participate in wholesale trading of currencies. The tax will not  affect the retail market, so it won’t affect ordinary consumers buying currency to go on holiday.

This proposal can be implemented by the UK alone and does not require international agreement. The distinction to understand is that the tax would be on sterling transactions wherever they are traded in the world, as opposed to all currencies (dollar, euro, yen) traded in the UK. Because the wholesale trade of sterling by the largest banks requires a credit line to the Bank of England, there is in effect an umbilical link that means that no matter where in the world financial institutions trade the pound –  New York, Hong Kong or Frankfurt – the tax can be collected in the UK.

UK leadership can kick start international agreement for financial transaction taxes across the world with the potential to raise up to $400 billion a year to safeguard jobs domestically and pay for commitments to meet the Millennium Development Goals and combat the adverse effects of climate change.

More information about the sterling transaction tax and why this is a good idea >>

Like many of the tens of thousands of supporters of the Robin Hood Tax I will be looking closely at your budget.  I hope you are not planning any measures that would mean people like me will again have to bear the brunt of paying down the deficit.

I strongly believe a tiny tax on major financial transactions is the fairest way to address the economic challenges we face. You could start on March 24th by putting a small tax on sterling currency transactions. This would hit multi-million pound trades by banks, not people’s holiday money. It could raise at least £3 billion every year to deal with the budget deficit, and provide extra money to address poverty and climate change. The UK’s leadership would also pave the way for other Robin Hood taxes at a global level.

The Treasury’s response at http://www.hm-treasury.gov.uk/global_tax_campaign_information.htm demonstrates that you are taking my views seriously. I am encouraged. To be clear: what I urge you to consider here is a unilateral sterling currency transaction tax in the Budget ahead of further international negotiation. I am not discussing an “insurance levy” in this instance.

Last year we all bailed out the banks and for many of them the worst has passed. But for people in the UK and around the world, the financial crisis is far from over.  It’s time for those who caused the crisis to take greater responsibility in putting our public finances right. I hope your budget will reflect this and that you will introduce the first Robin Hood Tax, on sterling.

A copy of this message has also been sent to the prospective parliamentary candidates in my constituency.

You may be interested to see how other MPs and candidates are engaging with us at http://robinhoodtax.org.uk/your-action/

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