Robin Hood corporate taxation? Good idea.

Whenever someone suggests corporations and the richest Canadians should pay their fair share of taxes – or at least something approximating the level they paid back in the post-war decades when rising prosperity was lifting all boats – the reflexive response is: “Oh, no, we couldn’t do that. They’d just move somewhere else.”

Impose taxes on carbon emissions in order to help scrub our screwed-up environment? But what about China? India? We couldn’t compete if our businesses had to actually pay for the environmental messes they create.

Protect the jobs of Canadian workers from sweatshops and cheap offshore competitors? But who would make our iPads if we did that?

Maintain social services, education, health care, pensions? Sorry, but those horses left their barns long ago…

So what can supposedly sovereign nations do when individual governments seem powerless in the face of rampant globalization and footloose capital?

Well, they could get together to create an international public counter-balance to out-of-whack corporate power and – at the least – begin to mitigate some of the worst effects of unfettered globalization.

Agreeing to a locally adopted, globally implemented financial transactions tax would be a smart start.

The idea – popularly known as the Robin Hood tax – originated with Nobel prize-winning economist James Tobin, who pitched a variation of the tax following the 1990s Asian financial crisis. Not surprisingly, his proposal has only gained traction in the wake of the 2008 global meltdown.

The miniscule tax – averaging no more than 0.05 per cent – would be tacked on to the cost of buying and selling all stocks, bonds, mutual funds, currencies, derivatives, futures, options, etc… (but not ordinary consumer transactions like credit card purchases, deposits and withdrawals).

Besides serving as a (probably only slight) brake on speculative trading, such a tax would have the more important impact of raising up to $400 billion a year.

Some of the revenue raised through the tax could be used to, in effect, either force banks to fund their own future bailouts or help underwrite economic recoveries. The rest could be put to all sorts of public goods at home and abroad, like maintaining and improving public services, fighting climate change, reducing world hunger … or some combination of the above.

The idea isn’t as radical as it might sound.

In 2010, an International Monetary Fund report called on governments to tax banks and financial institutions to create a global “rescue” fund for future bailouts.

Germany’s conservative chancellor Angela Merkel supports a transactions tax, as does France’s new left-of-centre president Francois Hollande, who actually campaigned and won his country’s recent national election with a Robin Hood tax-plank. Japan’s foreign minister is on side.

George Soros and Warren Buffet have joined the small but significant number of successful global capitalists who have also endorsed the proposal.

Last year, more than 1,000 economists from around the world – including Nobel prize winners Joseph Stiglitz and Paul Krugman – signed an open letter to G20 leaders urging them to introduce such a tax.

Public support is growing too. In recent surveys in England and the countries of the E.U., more than two thirds of respondents said yes to a transactions tax.

That’s partly because, two years ago, more than 50 charities and activist organizations there came together to launch a lobbying effort to explain and promote the tax. (Check out its funny but pointed YouTube video ad featuring British actor Bill Nighy as a deer-in-the-headlights businessman trying to explain why the tax isn’t a good idea.)

Today, that drive has spread to 14 countries, including, most recently, Canada. In June a coalition of union, nongovernmental organizations, anti-poverty organizations and community groups launched a campaign to put the tax on the agenda for next year’s federal budget consultations.

Convincing the Harper government won’t be easy, of course. Its I’m-all-right- Jack dismissal of global economic problems and its mindless anti-tax mindset – not to mention its parliamentary majority – will make it a tough nut to crack.

But, given what the last global meltdown did to the world’s economies and the seeming inevitability – in the face of the failure of governments to actually control the financial sector – of a next, worse one … the least the rest of us can do is make them pay for their own next bailout.

6 Comments to “Robin Hood corporate taxation? Good idea.”

  1. This sure gets my vote!

  2. […] read the full article, link here to Atlantic Business magazine. Like this:LikeBe the first to like this. This entry was posted in […]

  3. It’s a greatidea that refuses die. Although the Harper Government will never adopt it, the other parties in the House of Commons should be pushed to add it to thier platforms. This initiative comes with a lot of votes.

  4. 1) Charging more taxes to corporations effects the transfer of wealth from citizens to governments. Citizens buy from corporations, and when corporations are all subject to more taxation, they’re at no competitive disadvantage for raising their prices to cover the taxes. So corporations will sell for more to cover increased tax burden. Then citizens will pay more to cover increased corporate prices.

    Take away from this tax proposal – corporations remain the same size & strength, while governments grow in size & strength, and citizens lose strength, where “strength” is understood as purchasing power (ie, money).

  5. My very first choice would be to nationalize banks. Everywhere. No more socialization for a minority of unprincipled parasites while they preach the evils of socialism to those they exploit and denigrate, like girls who are raped and then blamed and punished for it in some barbaric places.

    Here’s the ‘least’ that interests me. Conditions. Strict conditions. In the ‘spirit’ of socialism for all, let the banks get at such a fund, created through the implementation of a Robin Hood tax, but only when their failures DO NOT INVOLVE CRIMINAL ACTIVITY. Create a tribunal even, composed partly of leftwing economists, and maybe a union leader (preferably one that hasn’t been urging workers to participate in the sham dark money-marinated, undemocratic, corrupt elections that perpetuate the mafia capitalist system) and let them decide whether a bank’s failure is criminal or not. If it’s good enough for the economic shock therapy-loving WTO (which, along with the IMF, good working papers on tax evasion notwithstanding, should crash and burn), then such a tribunal should be good enough for everyone.

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