We know from the 2008 crash and subsequent recession the destruction that is caused by the irresponsibility of the financial sector and financial markets focused on excessive profit seeking.
The FTT, at 0.1% on trading in bonds and shares and 0.01% on trading in derivatives would raise €320-€360 million for the Exchequer according to the Nevin Economic Research Institute (NERI).
This is a significant sum that could help redress some of the consequences of the financial crash and austerity in Ireland.
Ireland has a role to play in implementing the FTT as we are a global centre for collective investment funds. In 2015, the total value of investment funds being managed in Ireland was approaching €2 trillion ( €2,000bn). Some of this activity, such as high frequency financial trading, is economically and socially destructive. The FTT could deter such speculative trading and encourage more socially responsible investment and the development of a sustainable ‘ethical economy’. Given the small size of the tax, there is little evidence there would be significant relocation of activities from Dublin.
It appears there is some official reluctance at Ireland supporting the FTT unless the UK also does. However, we believe Ireland should take the lead on this, rather than deferring to London.
The FTT could contribute to protecting us against future economic storms, much of which are driven by speculative financial markets.