MEPs demand 'Robin Hood tax' on banks

MEPs today called for an EU “Robin Hood tax” on rich banks to help fund development policies for the poor.

A campaign for a global tax on banks’ financial transactions was launched in London last month as a means of raising money to fight poverty, tackle climate change and boost public services – re-balancing the books after the economic damage wreaked by financial excesses.

The tax would be levied on every financial transaction between financial institutions – not those conducted by ordinary bank customers – and could raise billions to plough into social policies, including tackling climate change.

However, an EU-level tax is not the right approach, insisted Wales MEP Ms Swinburne.

“The EU must not have tax-raising powers,” she said. “The financial services industry should play its part to ensure that the crisis never happens again. Some kind of levy on financial institutions could bare some merit.”

She went on: “However, we must not implement an EU solution to a global problem.

“To do so would further reduce competitiveness of the European economy, and raise the cost of capital to businesses.

“Any financial levy should be to stabilise the financial system, not to raise revenue for unrelated projects.”

A resolution approved by 536-80 votes said a “Financial Transaction Tax” could be used for “innovative financing” for climate change or development projects.

It backed a worldwide tax but asked the European Commission to look into how to implement such a tax at EU level if a global agreement cannot be reached.

Belgium and Austria have already backed a special European tax, while the UK, France and German support such a financial tax at global level.

EU Taxation Commissioner Algirdas Semeta said the issue was best tackled at global level – the only way to prevent a flight of capital from the EU.

Without a clear “distributive mechanism” for such a tax, the revenue generated could end up in the few countries with large financial centres.