Search this site

When campaigners and policymakers propose new taxes to fund urgent global issues like the escalating climate crisis or international development, they often hit a bureaucratic brick wall. Finance Ministries and Treasuries frequently argue that "hypothecating" or ring-fencing tax revenues for a specific purpose is bad practice. They claim it introduces unnecessary complexity, administrative burdens, and robs governments of the flexibility to adjust spending. However, a July 2025 report by Stamp Out Poverty, titled Ring-Fencing Taxation, thoroughly dismantles this narrative. The report demonstrates that earmarking tax revenues is not only entirely feasible due to modern digital financial systems, but it is already a widespread, highly successful practice across the globe. Here is a look at how and why governments around the world are already successfully ring-fencing public finance. The Myth of "Too Complex" vs. The Automated Reality The traditional argument against hypothecation belongs to the last century. Today, the digitalization and automation of financial systems and transfers mean there are zero technical barriers to earmarking a specific tax receipt for a particular area of spending. From an operational standpoint, ring-fencing is completely within the day-to-day competence of modern tax authorities. When governments claim that earmarking revenues is too complex, they are ignoring the reality that they already do it extensively to fund health, social protection, and environmental initiatives. Global Proof: India's $300 Billion Success Story One of the most striking examples of successful ring-fencing is India's use of the "cess" tax. A cess is essentially a "tax on a tax" collected by the federal government to raise funds exclusively for specific, predetermined purposes. India leverages the cess to fund targeted public welfare initiatives, including health and education for people living below the poverty line, road infrastructure, and clean energy. The clean energy cess operates as a carbon tax on the production and import of coal, lignite, and peat, directly applying the "polluter pays" principle. Revenue from a cess is credited to the Consolidated Fund but remains distinct from general revenue, ensuring it is appropriated by Parliament solely for its specified purpose. Over the 10 years leading up to 2023/24, Indian central government cess receipts totalled an estimated $287.6 billion (INR 21 trillion). This proves that large-scale hypothecation is not only possible but can reliably generate hundreds of billions of dollars for vital public goods. Widespread Earmarking Across the World India is far from alone. Governments across multiple economic sectors utilize ring-fencing to guarantee funding for critical services: Health and Public Welfare Worldwide, 80 countries, including Brazil, France, Germany, Japan, and the UK ring-fence taxes specifically for health spending. Brazil's earmarking of public health expenditure resulted in an estimated public healthcare spend of $772 billion over the 10 years to 2023. The Philippines successfully funds its national health insurance program by earmarking revenues from "sin taxes" on tobacco, alcohol, and sugar-sweetened beverages. Social Protection The United States finances its Social Security programme through a dedicated, ring-fenced payroll tax. In 2023 alone, total income to the combined Social Security trust funds amounted to $1.351 trillion. In the UK, National Insurance contributions have always acted as a hypothecated tax, paying principally for State Pensions and some NHS spending. Over the 10 fiscal years to 2023/24, these ring-fenced receipts totalled an estimated $1,474 billion (£1,086 billion). Environmental Protection and Public Services Belize charges a $4 tourist tax on passengers arriving by plane or cruise ship, earmarking the funds directly to a national conservation trust to support protected areas. The UK's BBC television licence fee is a classic hypothecated fee, generating approximately $51 billion (£37.2 billion) over the 10 fiscal years to 2023/24 to directly fund public broadcasting. In 2025, the UK introduced a 20% VAT on private school fees, with the government publicly ring-fencing the projected £1.8 billion annual revenue to pay for 6,500 new state school teachers. Why Ring-Fencing Matters Now We are facing a widening gap between the public finance available and the money urgently needed to support the world's most vulnerable communities. Official development assistance (ODA) across OECD countries is projected to drop by 9 to 17% in 2025, and the costs of climate loss and damages in lower-income countries are expected to soar past $300 billion per year by 2030. In this context, ring-fenced taxes provide an innovative and highly effective solution to unlock new funds. By explicitly tying taxes on polluting industries or extreme wealth to popular public goods, like climate resilience or global health, governments can turn a potentially bitter economic pill into a policy that wins widespread public trust and approval. The evidence is clear: Treasuries and Finance Ministries have the automated tools to earmark funds efficiently. What is required now is the political will to use them.

Published in June 2025, Fast, Fair, Forever: How Public Finance can Supercharge the Just Energy Transition presents a comprehensive framework for transforming global energy systems. Authored by Dr. Sindra Sharma, with project leadership by Harjeet Singh (Founding Director of the Satat Sampada Climate Foundation), the paper was published by Stamp Out Poverty alongside partner organizations including 350.org, Climate Action Network (CAN) International, Christian Aid, and the Pacific Islands Climate Action Network (PICAN). The report confronts a fundamental truth: the clean energy revolution cannot rely solely on market forces or profit-driven private capital. Instead, public finance must lead the charge, absorbing early risks, building critical infrastructure, and ensuring social justice at every step. 1. The Twin Challenge: Climate Urgency and Energy Access The world faces two simultaneous imperatives that must be solved together rather than pitted against each other: Urgent Climate Action: The Intergovernmental Panel on Climate Change (IPCC) warns that limiting warming to 1.5°C requires immediate, deep greenhouse gas reductions across all sectors. Climate-related disasters caused over $1.4 trillion in global economic losses between 2010 and 2019, with damages in 2023 alone exceeding $280 billion. Universal Energy Access: Approximately 1.18 billion people globally live in energy poverty, while 2.3 billion people still rely on polluting fuels for cooking, causing 3.7 million premature deaths annually, primarily among women and children. The paper dismantles the false narrative that developing nations must choose between economic development and climate protection. Transitioning to decentralized renewable energy (such as solar home systems and mini-grids) provides the fastest, most cost-effective pathway to eliminate energy poverty without expanding carbon emissions or locking countries into volatile fossil fuel markets. 2. Defining a "Just and Equitable Energy Transition" A genuine transition is not merely a technological swap of coal or gas for solar panels; it is a systemic shift rooted in social justice. As defined by the IPCC, a just transition ensures that no workers, communities, or regions are left behind. Core principles include: Respect and dignity for fossil fuel-dependent workers and affected communities. Creation of decent, high-quality jobs in clean energy industries. Comprehensive social protection and reskilling programs. Free, Prior, and Informed Consent (FPIC) and protection of human rights. Global equity adhering to the principle of Common but Differentiated Responsibilities and Respective Capabilities (CBDR-RC). "A just energy transition refers to a deliberate approach to moving from fossil fuels to a renewable energy system in a way that is fair, inclusive, and leaves no one behind." 3. Why Public Finance is the Essential Linchpin Private finance follows where public finance paves the road. Profit-driven investors rarely enter unproven sectors or low-income regions without public capital absorbing initial risks, lowering the cost of capital, and setting clear strategic policies. Key Functions of Public Finance: Equity and Access: Public finance directs resources to remote or low-income communities where commercial projects fail to meet private profit thresholds. De-risking Innovation: Public grants, concessional loans, and guarantees lower capital costs for early-stage technologies (e.g., energy storage, grid modernization). Fulfilling Global Commitments: Wealthier nations that built their prosperity on fossil fuels carry a historical obligation to provide predictable, grant-based international public finance to the Global South. 4. Case Studies: Public Finance in Action The paper evaluates real-world examples demonstrating both the power and necessity of public finance across diverse economic contexts: India: Public policies and initial de-risking mechanisms have powered a world-leading solar expansion, such as the $600 million Production-Linked Incentive (PLI) scheme for domestic solar manufacturing. However, the report highlights critical equity gaps, noting that large utility-scale projects (like the 2,245 MW Bhadla Solar Park) have sometimes dispossessed marginalized communities without adequate compensation or local job guarantees. China: Managing transition in coal-dependent provinces (e.g., Wuhai and Tongchuan) relied on allocating over $3.5 billion annually from central public funds to support social security, retrain workers, and fund non-coal industrial diversification. Brazil: The national development bank, BNDES, has historically anchored renewable energy funding. Innovative public vehicles like the Green Receivables Fund (Green FIDC) use public first-loss capital to mobilize over $114 million in private investment. Chile: The government’s government-led coal phaseout plan provides regulatory certainty, grid infrastructure investments, and retraining programs rather than waiting for market forces to act. Vanuatu: In its ambitious NDC 3.0, Vanuatu aims for nearly 100% renewable electricity by 2035. However, this plan is explicitly conditional on receiving international public financial support (estimated at $2.8 billion total costed needs across mitigation, adaptation, and loss and damage). 5. The Misallocation Crisis: Misdirected Funds and Debt Traps While funds for clean energy remain scarce in the Global South, public finance is routinely directed to destructive sectors: In 2022, governments spent a record $7 trillion (7% of global GDP) on fossil fuel subsidies. Global military expenditure topped $2.4 trillion in 2023. Approximately 70% of climate finance provided by wealthy nations arrives in the form of loans rather than grants, compounding a $29 trillion sovereign debt crisis where 93% of the poorest countries face high debt distress. Furthermore, initiatives like the Just Energy Transition Partnerships (JETPs) in South Africa and Indonesia have struggled due to a paucity of grant funding, offering market-rate loans that heighten distrust between donor and recipient nations. 6. Systemic Policy Recommendations for COP30 and Beyond To build a climate-safe and equitable future, the discussion paper outlines concrete policy actions: Prioritize Public Finance for Systemic Change: Shift public funds away from "bankable" commercial projects toward universal energy access, social protection, community-owned mini-grids, and public care infrastructure (health, education, public transit). End and Redirect Fossil Fuel Subsidies: Establish binding timelines to phase out fossil fuel subsidies and redirect those trillions into renewable energy and social safety nets. Implement Innovative Tax Measures: Adopt mechanisms like the Climate Damages Tax (CDT), a fee starting at $5/tCO2e on fossil fuel extraction, to generate up to $900 billion from OECD nations by 2030 to fund Loss and Damage and domestic transition dividends. Deliver Grant-Based Finance and Debt Cancellation: Ensure the New Collective Quantified Goal (NCQG) and post-2025 targets deliver predictable, grant-based public climate finance while canceling unsustainable sovereign debt. Guard Against Green Extractivism: Enforce strict environmental and social safeguards, guarantee Free, Prior, and Informed Consent (FPIC) for Indigenous peoples during critical mineral extraction, and support a moratorium on deep-sea mining.

Resetting Our Level of Ambition In the face of the COVID-19 pandemic, the world witnessed an unprecedented mobilization of resources. By October 2020, countries had taken fiscal action amounting to a staggering $12 trillion, nearly 12 per cent of global GDP, to respond to the crisis. The International Monetary Fund (IMF) quickly secured $1 trillion in lending capacity to meet immediate global demands. This rapid, massive deployment of capital teaches us a vital lesson: when a crisis is treated as a true emergency, the necessary funds can and will be found. The first briefing in the Unpacking Finance for Loss and Damage series, produced by Stamp Out Poverty, Heinrich Böll Stiftung, ActionAid International, Bread for the World, and Practical Action argues that we must apply this exact level of ambition and global solidarity to the climate crisis. While COVID-19 was an acute shock, catastrophic climate change is a long-lasting challenge that is already causing irreversible loss and damage to lives, livelihoods, and ecosystems in vulnerable developing countries. The Scale of the Loss and Damage Crisis Loss and damage refers to the impacts of climate change that can no longer be avoided by mitigation or adaptation, ranging from extreme weather events like super storms to slow-onset processes like rising sea levels. Developing countries have long stressed that these impacts require targeted support, leading to the official inclusion of Loss and Damage as a distinct article in the 2015 Paris Agreement. The financial toll is escalating rapidly. Studies estimate that the economic cost of loss and damage in developing countries alone will reach between $290 billion and $580 billion annually by 2030. By 2050, that figure could soar to between $1 trillion and $1.8 trillion. To meet this need, the briefing proposes a "fast start" commitment of $75 billion between 2020 and 2023, scaling up to at least $150 billion a year by 2030 from public sources. Six Innovative Finance Solutions To raise an additional $150 billion a year by 2030, the international community must harness innovative alternative financing tools. The briefing identifies six highly promising mechanisms: Special Drawing Rights (SDRs): The IMF could issue and reallocate unused SDRs (foreign exchange reserve assets) to free up fiscal space for developing countries. A new $1 trillion to $2 trillion allocation would help nations build long-term climate resilience. Redirecting Fossil Fuel Subsidies: In 2017, global fossil fuel subsidies reached a massive $5.2 trillion (6.5 per cent of global GDP). Redirecting just a fraction of this such as a 4 per cent annual decrease by G-20 nations could raise $245 billion by 2030 for loss and damage efforts. Financial Transactions Tax (FTT): A modest levy on trades of stocks, bonds, and derivatives could raise tens of billions. Expanding this to the $6.6 trillion-a-day foreign exchange market could yield up to $297 billion annually. Climate Damages Tax (CDT): Also known as a Robin Hood tax on polluters, this fee on the extraction of coal, oil, and gas is based on embedded carbon emissions. Increasing annually, the CDT could raise an estimated $210 billion in its first year alone while incentivizing the phase-out of fossil fuels. Air Passenger Levy: Modeled after the successful French-led UNITAID initiative, a small tax on international airfares (e.g., up to $6 for economy class and $62 for business/first class) could generate $8 billion to $10 billion annually. Debt Relief: Developing countries spend $300 billion annually on debt repayments. Canceling debt or utilizing debt-for-climate swaps would immediately free up domestic resources, allowing vulnerable countries to fund their own resilience and recovery efforts rather than servicing external creditors. The pandemic proved that we can unite to tackle monumental global challenges. We invite you to read the full briefing to explore how establishing an international solidarity facility funded by these innovative mechanisms can safeguard the most vulnerable communities from the escalating climate emergency.

A Vision for Long-Term Finance Published in September 2019 by Intelligence Capital, Reinforcing Resilience presents a bold vision for the future of the UK financial sector. Authored by Keval Bharadia, former Head of Derivatives Product Development at the London Stock Exchange, and Laurey Boughey of Stamp Out Poverty, the report builds upon Professor Avinash Persaud's 2017 proposal (Improving Resilience, Increasing Revenue). The authors argue that the UK's financial sector has veered dangerously toward a "transactions-led model" where short-term trading and excessive portfolio churning dominate. By expanding the scope of financial transactions taxes (FTTs), the UK can disincentivize socially unproductive speculation and reorient the City of London into a "citadel of long-term investment". Expanding the Tax Base The 2017 proposal successfully demonstrated how modernizing the existing UK Stamp Duty Reserve Tax (SDRT) on equities, specifically by closing the intermediary exemption and including corporate bonds and equity/credit derivatives could raise an additional £4.7 billion annually. Reinforcing Resilience pushes this framework further, advocating for the inclusion of three massive, previously untaxed asset classes: 1. Foreign Exchange (FX) The foreign exchange market is the largest in the world, with a daily notional turnover exceeding $5 trillion. The report proposes taxing the wholesale FX market, both spot and derivatives, which is dominated by large investment banks. Crucially, retail foreign exchange (such as public currency purchases for travel) would be entirely exempt, as would the first £1,000 of daily transactions per market participant. Because genuine trade-related FX trading represents less than one-tenth of total transactions, the tax would squarely target the high-frequency speculative churn that drives boom-and-bust cycles. 2. Interest Rate Derivatives With a staggering daily global notional turnover of $10.5 trillion, interest rate derivatives are heavily utilized by banks for hedging and speculation. The authors emphasize that taxing wholesale trades of these derivatives would not impact retail interest rates for mortgages or personal loans, which are dictated by central bank base rates and inter-bank lending rates, not marginal derivative costs. To protect cash-like transactions, derivatives with a maturity under three months would be exempt. 3. Commodities The report also proposes taxing both the spot and derivative markets for commodities (such as energy, metals, and agricultural products). Including both markets ensures that traders cannot simply substitute spot trading for derivatives to avoid the tax. Revenue Potential and Collection By calculating the economic value of these trades (rather than their inflated notional values), the authors estimate that taxing these additional assets would generate £2.13 billion annually for the UK Exchequer. Foreign Exchange Spot: £1.79 billion Foreign Exchange Derivatives: £0.10 billion Interest Rate Derivatives: £0.14 billion Commodities (Spot and Derivatives): £0.10 billion The report outlines a robust collection methodology based on the "residence principle," meaning any UK tax resident would be liable for the tax regardless of where the trade physically occurs. Collection would be automated by integrating the tax into existing clearing and settlement networks, such as the Continuous Linked Settlement (CLS) Bank for FX and SwapClear for interest rates. Dispelling the Myths The authors preempt the financial lobby's predictable objections, particularly threats of capital flight in a post-Brexit landscape. They argue that the proposed tax rates (e.g., 0.02% for financial firms trading FX) are set conservatively at just 50% of existing transaction costs. This marginal increase is far too small to prompt an exodus, especially when weighed against the UK's deep market infrastructure, access to human capital, and competitive corporation tax rates. Furthermore, the tax actively benefits long-term investors like pension funds, who trade infrequently and are currently losing billions to the high fees charged by high-turnover hedge funds. Ultimately, Reinforcing Resilience proves that by implementing a comprehensive FTT, the UK can raise vital public funds while actively building a safer, more productive financial system for the future.

The Unkept Promises of Development Finance As school strikes and global protests demand urgent action on climate breakdown and economic inequality, the world faces a critical deadline to drastically reduce carbon emissions and fund the Sustainable Development Goals (SDGs). Agreed upon by all 193 UN member states in 2015, the 17 SDGs represent a collective commitment to end global poverty, fight inequality, and protect the planet by 2030. However, richer nations are failing to deliver the necessary funding. While Official Development Assistance (ODA) has stagnated at roughly $150–$160 billion annually, aid to the world's poorest countries has actually been cut. Facing an annual SDG funding gap exceeding $1 trillion, politicians in wealthy nations and multilateral institutions like the World Bank have turned to a convenient rhetoric: "Billions to Trillions" (B2T). This agenda claims that by using public aid to "blend" and subsidize private investment, billions in aid can catalyze trillions in private capital for infrastructure, healthcare, and education across developing economies. But as local communities, campaigning groups, and developing country governments have consistently warned, this approach relies on "dodgy deals" repackaged versions of the failed Private Finance Initiative (PFI) contracts that left European and developing country governments paying exorbitant fees for shoddy public infrastructure. The One-Tenth Reality Check To challenge the political narrative that private investors hold the key to solving global poverty, Stamp Out Poverty launched the policy brief Billions to Trillions: A Reality Check at the UN in New York. Authored by financial expert Sony Kapoor of the think tank RE-DEFINE, the report systematically dismantles the mathematical gymnastics used to justify the B2T agenda. Kapoor’s research highlights the fundamental mismatch between top-down political decrees and bottom-up investment realities: The Mobilisation Deficit: Historically, Development Finance Institutions (DFIs) have achieved private capital mobilization ratios of less than 1:1 (less than one dollar of private capital per dollar of public capital). The Hard Ceiling: Even under highly ambitious, best-case scenarios across leading DFIs, realistic private capital mobilization could reach $40–$60 billion annually, or at most $100 billion. The One-Tenth Fact: If developing countries stick to promising realistic, non-exploitative profits, private capital will only ever cover one-tenth of the $1 trillion annual SDG funding gap. "Saying that private investors will fill the SDGs funding gap lets politicians off the hook. But if developing countries stick to promising realistic profits, banks and private investors will only ever stump up one-tenth of the cash needed." The Real-World Harm of "Blending Evangelism" Relying on "blended finance" as a silver bullet does not merely fall short on math; it actively risks damaging global development efforts: Market Distortions: Over-subsidizing private investors with scarce public ODA creates a "race to the bottom". For instance, heavily subsidized off-grid solar projects can set artificial price expectations that squeeze out non-subsidized local competitors and thwart un-subsidized energy investments across neighboring regions. Diversion of Aid: Private capital naturally flows toward richer, middle-income countries and commercial sectors (such as telecom) where returns are higher. Over-emphasizing private mobilization diverts scarce ODA away from conflict zones, fragile states, and essential social services like health and basic education that require direct public funding. Distorted Expectations: The constant chatter that "soft money" subsidies are freely available encourages commercial asset managers to demand public risk-underwriting before committing capital, undermining genuine risk-absorbing private investment. Real Solutions for a Global Crisis To prevent public development funds from being squandered on unnecessary private subsidies, the report outlines immediate recommendations, including a 1-to-2-year moratorium on new blending facilities to audit existing programs and enforce strict rules on subsidy limits and transparent governance. More importantly, world leaders must stop fobbing off the public with the lie that private finance will solve systemic crises. Meeting the SDGs and confronting climate breakdown requires proven, equitable, public-led solutions: Unconditional Debt Relief for nations trapped in cycles of debt servicing. Aggressive Action on Tax Avoidance and tax evasion to build domestic revenue capacity. Increased Direct ODA from rich nations to fulfill historical aid commitments. Global Solidarity Taxes on those most able to pay, including the Robin Hood Tax on financial transactions and the Climate Damages Tax on fossil fuel extraction. We invite policymakers, advocates, and citizens to read the full report, Billions to Trillions: A Reality Check, and join the call for genuine financial justice.

Ahead of the 2017 UN summit on climate change (COP23) more than sixty organisations committed to work with us toward establishing a Climate Damages Tax. These include: international organisations like Greenpeace, WWF, CARE, Christian Aid and Practical Action; global networks like Climate Action Network; regional groupings of states such as the Pacific Islands Development Forum; youth organisations such as the Caribbean Youth Environment Network, the Arab Youth Climate Movement and UK Youth Climate Coalition; and climate experts such as Naomi Klein. Climate Damages Declaration We, the undersigned: Observe, with mounting alarm, the ever growing numbers of people whose homes are lost, lives disrupted, critical ecosystems imperilled and livelihoods ruined due to the damage inflicted by an increasingly hostile climate bringing hurricanes of greater intensity, devastating floods and encroachment of rising seas Note that vulnerable countries, communities and ecosystems on the frontline of catastrophic climate change now face, due to lack of meaningful progress to reduce carbon emissions to date, changes in climate beyond the ability of people and ecosystems to adapt to – a phenomenon described as ‘Loss and Damage’ Recall the Paris Climate Agreement in 2015 (COP21) where countries agreed to pursue efforts to keep temperature rise to 1.5C and where ‘Loss and Damage’ was officially recognised as a separate pillar alongside ‘Mitigation’ and ‘Adaptation’, building upon the Warsaw International Mechanism for Loss and Damage (WIM) established in 2013 at COP19. Further note that the WIM has yet to make progress on its core mission of delivering finance for addressing loss and damage. Further observe that the countries and communities most deeply affected by irreversible climate change did not create these conditions, yet are paying the price of this damage whilst, at the same time, the fossil fuel industry – responsible for approximately 70% of the world’s greenhouse gas emissions [1] – continue to profit while bearing none of the costs consequent from the use of their products Declare that, consistent with the ‘polluter pays’ principle, it is now time for the industry most responsible to pay for the damage it has caused, and for vulnerable countries worst affected to receive the financial assistance they so urgently need. To this end, we demand and commit ourselves to advocating for: The establishment of an initiative for loss and damage finance with a two year work plan identifying sources of revenue adequate to the scale of the problem in a predictable and fair way; the introduction of an equitable fossil fuel extraction charge – or Climate Damages Tax – levied on producers of oil, gas and coal to pay for the damage and costs caused by climate change when these products are burnt, implemented nationally, regionally or internationally the use of the substantial revenues raised to be allocated through the appropriate UN body, such as the Green Climate Fund or similar financial mechanism, for the alleviation and avoidance of the suffering caused by severe impacts of climate change in developing countries, including those communities forced from their homes the urgent replacement of fossil fuels, by mid-century at the latest, with renewable sources of energy assisted by increasing the rate of the Climate Damages Tax over time Your organisation may sign the Declaration –> here [1] The Carbon Majors Database, CDP report, July 2017 Signed by: Climate voices/experts: Naomi Klein (Canada) – Author/filmmaker George Monbiot (UK) – Journalist/author Maya Goodfellow (UK) – Journalist Ambassador Ronny Jumeau – Seychelles Organisation Name 1. Oxfam International Winnie Byanyima, Executive Director 2. Greenpeace International Yeb Sano, Executive Director South East Asia 3. WWF International Fernanda Viana De Carvalho 4. CARE International Sven Harmeling, Global Policy Lead Climate Change and Resilience 5. Pacific Islands Development Forum Francois Martel, Secretary General 6. Climate Action Network International Wael Hmaidan, Director 7. Change Partnership (international) Sanjeev Kumar, Founder 8. Practical Action (international) Paul Smith Lomas, CEO 9. Christian Aid (international) Mohamed Adow, International Climate Lead 10. Climate Justice Programme (international) Stephen Leonard, President 11. Earthlife Africa Johannesburg (South Africa) Makoma Lekalakala – Branch Coordinator 12. Africans Rising for Justice, Peace and Dignity (international) Muhammed Lamin Saidykhan, Movement Coordinator 13. 350.org (international) May Boeve, Executive Director 14. Oil Change International (international) Stephen Kretzmann, Executive Director 15. Heinrich Böll Foundation (international) Barbara Unmüßig, President 16. Less Meat Less Heat (international) Mark Pershin 17. Global Climate Finance Campaign (international) Kumi Naidoo, Chair 18. Caribbean Youth Environment Network (CYEN) Reginald I. Burke, Executive Coordinator 19. CAN Europe Wendel Trio, Director 20. Health Care Without Harm Europe Anja Leetz, Executive director 21. 350 Pacific Fenton Lutunatabua, Pacific Regional Coordinator 22. CAN South Asia Sanjay Vashist, Director 23. HOMEF (Nigeria) Nnimmo Bassey, Director 24. Central Victoria Climate Action (Australia) Trevor Scott, Director 25. Lighter Footprints (Australia) Carolyn Ingvarson 26. Pacific Calling Partnership (Australia) Jill Finnane 27. International Centre for Climate Change and Development (ICCCAD) (Belgium) Dr Saleemul Huq, Director 28. CNCD-11.11.11 asbl (Belgium) Nicolas Van Nuffet, Director 29. 11.11.11 (Belgium) Jan Van de Poel, Policy Director 30. Energy Mix Productions (Canada) Mitchell Beer, Founder/Publisher 31. The Leap (Canada/United States) Katie McKenna and Bianca Mugyenyi, Co-Executive Directors 32. Abibiman Foundation (Ghana) Kenneth Nana Amoateng 33. Oilwatch Ghana (Ghana) Noble Wadzah 34. Clean Air Action Group (Hungary) András Lukács, President 35. Arab Youth Climate Movement (Lebanon) Nouhad Awwad, National Coordinator 36. ASTM / Climate Alliance (Luxembourg) Dietmar Mirkes, coordinator Climate Alliance 37. Oikos – Cooperação e Desenvolvimento (Portugal) João José Fernandes, Chair 38. ZERO – Association for the Sustainability of the Earth System (Portugal/International) Francisco Ferreira, President 39. The Lutheran World Federation (South Africa) Khulekani Magwaza, Council Member 40. Janathakshan GTE (Sri Lanka) Ranga Pallawala, CEO 41. Alliance Sud – Swiss Alliance of Development Organizations (Switzerland) Mark Herkenrath, Director 42. Stamp Out Poverty (UK) David Hillman, Director 43. RESULTS UK Aaron Oxley, Executive Director 44. Global Justice Now (UK) Dorothy Grace Guerrero 45. The Equality Trust (UK) Dr Wanda Wyporska 46. War on Want (UK) Asad Rehman, Executive Director 47. UK Youth Climate Coalition Lise Masson 48. EEECHO (Unites States) Ruth Story, Executive Director 49. Heinrich Böll Stiftung North America (Unites States) Liane Schalatek, Associate Director 50. Climate Accountability Institute (United States) Richard Heede, Director 51. EcoEquity (United States) Tom Athanasiou, Executive Director 52. Sierra Club (United States) Michael Brune 53. Young Evangelicals for Climate Action (YECA) (United States) Kyle Meyaard-Schaap, National Organizer and Spokesperson 54. Center for Biological Diversity (United States) Jean Su, Associate Conservation Director 55. Care About Climate (United States) Natalie Lucas, Executive Director 56. Sociedad Amigos del Viento (Uruguay) Graciela SalaberriMuhammed Lamin Saidykhan, Movement Coordinator 57. Climate Action Moreland (Australia) John Englart 58.Leap Victoria (Canada) Howard Breen, Co-Chair 59. Uganda Coalition for Sustainable Development Kimbowa Richard 60.Democratic Socialist/NDP (Canada) Art Jaszczyk 61.Citizens United for a Sustainable Planet (Canada) Paul Berger 62.Unitarian Universalist Service Committee (USA) Rev. Dr. Lyssa Jenkens, Board Chair 63.West Coast Enviromental Law Andrew Gage 64. System Change Not Climate Change 65.Climate Justice Project

The Devastating Impact of Currency Volatility In July 2004, the Tobin Tax Network published a comprehensive report authored by Sony Kapoor outlining a modernised, highly feasible framework for a Currency Transaction Tax (CTT). The report addressed a global foreign exchange market that had grown to a staggering turnover of $300,000 billion annually, equivalent to more than fifty times the total volume of world trade. Kapoor demonstrated that the vast majority of this trading had a time horizon of less than a week, driven overwhelmingly by speculation, technical trading, and psychological bandwagon effects rather than underlying economic fundamentals. This systemic misalignment periodically results in severe currency crashes, such as those witnessed in Mexico (1994), South East Asia (1997–98), Russia (1998), Brazil (1999), and Argentina (2001). These crises have profound social and economic consequences, leading to massive job losses, slashed social security spending, and millions of people being plunged into extreme poverty. The Two-Tier CTT Proposition To combat this instability, the report built upon German economist Paul Bernd Spahn's concept of a two-tier Tobin Tax, modernising it to suit highly electronic global markets. The proposal established two distinct tax rates to serve two separate goals: The Base Rate for Development: A minimal tax of 0.005 per cent (half a basis point) applied to all foreign exchange transactions. Because the market is so vast, this tiny levy would raise between $10 billion and $15 billion annually without disrupting normal market functions. The Surcharge for Stability: A punitive tax rate, potentially as high as 50 per cent, functioning as an automatic "circuit breaker". This rate would only trigger if a currency's value fluctuated outside a predetermined normal band (e.g., moving more than 5 per cent from the previous day's closing price). By making leveraged speculation prohibitively expensive, it stops speculative attacks dead in their tracks. A Mainstream and Enforceable Solution Opponents frequently attempt to dismiss the Tobin Tax as an unworkable, radical theory, but the report proved that the core mechanics already existed in mainstream finance. Security transaction taxes were already successfully raising billions in the United Kingdom (Stamp Duty Reserve Tax) and the United States, while circuit breakers halting excessive price swings had been standard practice on major stock exchanges since the 1987 crash. Crucially, Kapoor outlined an airtight collection method to prevent tax evasion: The tax must be levied on the currency, not the jurisdiction. If the UK adopted the CTT, all trades involving Pound Sterling would be taxed globally, because any Sterling trade must ultimately settle through the Bank of England's jurisdiction via 'nostro' accounts. Collection would be fully automated at the point of settlement through modern electronic systems like the Continuous Linked Settlement (CLS) bank or domestic gross settlement systems. Unlocking Global Prosperity The revenue generated by the base rate was explicitly earmarked to help fund the United Nations Millennium Development Goals (MDGs), aiming to halve world poverty by 2015. However, the report argued that the indirect economic benefits of the CTT would be even more profound. By virtually eliminating the threat of catastrophic currency crashes, developing countries would no longer be forced to hoard massive, unproductive foreign exchange reserves to defend their currencies. The report estimated that releasing just half of these excessive reserves could free up $750 billion for vital domestic investments in health, education, and infrastructure. Furthermore, a stabilised currency market reduces the high costs of hedging for multinational businesses, encourages foreign direct investment, and allows governments to maintain the lower interest rates necessary to stimulate long-term economic growth.

The Illusion of the "Billions to Trillions" Agenda Published in March 2019 by Stamp Out Poverty, Billions to Trillions: A Reality Check provides a vital critique of the prevailing narrative surrounding global development finance. Authored by Sony Kapoor of the international think tank RE-DEFINE, this policy brief was officially launched during the 2019 UN Financing for Development Forum in New York. Achieving the Sustainable Development Goals (SDGs) by 2030 requires massive infrastructure and social investments. With Official Development Assistance (ODA) stagnating at roughly $150 billion to $160 billion annually, developing countries face an annual funding gap exceeding $1 trillion. To plug this gap, the international donor community has aggressively championed the "Billions to Trillions" (B2T) agenda. This concept relies heavily on "blending", the strategic use of public ODA subsidies to reduce risk and attract private capital into developing economies through Development Finance Institutions (DFIs). Mathematical Gymnastics vs. Bottom-Up Reality The report argues that the mobilisation potential of blending has been severely oversold. The prevailing rhetoric suggests that billions in aid can magically unlock trillions in private investment, but the report dismisses these claims as "mathematical gymnastics" disconnected from real-world market dynamics. Historically, DFIs have struggled to achieve mobilisation ratios of even 1:1. While highly optimized efforts and new partnerships might stretch this ratio to 2:1 or 3:1, potentially generating tens of billions in additional capital, the B2T agenda exaggerates realistic private capital mobilisation by a factor of ten. A fundamental limitation is that DFIs operate on a bottom-up investment model; no amount of public subsidy can turn a fundamentally unviable project into a profitable one. The Dangers of Blending Evangelism The report warns that continued blending evangelism is not just inaccurate; it is actively unhelpful in reaching the Sustainable Development Goals: Top-down pressures to deploy "soft money" subsidies distort local markets, creating an unhealthy race to the bottom that squeezes out non-subsidised commercial projects. Unrealistic B2T expectations distract stakeholders from pursuing other crucial systemic policies, such as improving domestic tax revenues and combating tax evasion. An excessive focus on private sector blending diverts scarce ODA away from critical areas where private capital will never go, such as humanitarian aid and budget support for fragile, conflict-affected states. Correcting the Course: Policy Recommendations To ensure that development finance serves the world's poorest without wasting taxpayer resources, the report outlines several strict policy recommendations: Implement a one to two-year moratorium on new blending facilities until current design, capacity, and incentive issues are fully resolved. Default to using existing DFIs and multilateral development banks rather than establishing new, poorly staffed blending windows run by donor agencies. Establish strict rules governing the use of blending, including firm limits on the amount and duration of subsidies, professional pricing by investment experts, and explicit, upfront development justifications. We invite policymakers, development professionals, and activists to read the full policy brief, to explore how we can replace harmful hype with grounded, effective development finance strategies.

An Unprecedented Call from Inside the Industry Writing in 2017, amidst prolonged negotiations among ten European nations working to introduce a regional Financial Transaction Tax, an extraordinary coalition of financial insiders stepped forward to demand action. Addressed to the heads of state of Austria, Belgium, France, Germany, Greece, Italy, Portugal, Slovakia, Slovenia, and Spain, this open letter represented a powerful endorsement of the tax from the very sector it sought to regulate. Signed by fifty-two prominent financial industry professionals, including former regulatory chairmen, banking executives, hedge fund managers, and leading academics, the letter forcefully urged European leaders to finalise their negotiations and implement a robust tax to rein in speculative excess and generate vital public revenue. The Core Proposal: Rebalancing the Markets The signatories leveraged their first-hand knowledge and significant experience within the financial industry to advocate for the immediate introduction of small Financial Transaction Taxes. The core proposition of the letter was that these levies are essential to rebalance financial markets away from the dangerous, short-term trading mentality that had severely compromised global economic stability. The professionals argued that applying a tax of merely a small fraction of a per cent on each trade would successfully moderate the distorted incentives driving short-term speculation, while simultaneously having a completely negligible impact on genuine, long-term investment. The Evidence: Restoring Finance to its Proper Role To contextualise the urgent need for intervention, the letter presented a stark reality regarding the explosive, unchecked growth of the financial sector. The authors noted that over the preceding decades, financial market activity had increased so tremendously that the value of transactions was now seventy times greater than the size of the real global economy. The signatories reminded European leaders that the primary, fundamental role of financial markets is to raise investment, allocate resources efficiently, and mitigate risk for the real economy. However, they warned that the vast majority of contemporary financial activity no longer contributed to these foundational goals. In particular, the letter fiercely criticised the rise of computer-driven, high-frequency trading. These algorithmic systems, designed solely to extract very short-term profits, were condemned by the professionals for misallocating global resources and actively draining liquidity from stressed markets exactly when it is needed the most. Addressing the Scepticism: Growth and the Brexit Threat Anticipating the standard objections deployed by financial lobbyists, the fifty-two professionals systematically dismantled the arguments used to stall the European negotiations. Addressing the persistent myth that a transaction tax would damage economic growth, the signatories pointed to a growing body of evidence proving the exact opposite. By deliberately reducing market volatility, adding long-term stability, and raising much-needed public revenue, the overall macroeconomic effect of the tax would be significantly positive. The letter also directly tackled the opportunistic argument that the United Kingdom's recent vote to exit the European Union was a valid reason to delay or suspend the tax. Lobbyists had wrongly claimed that introducing the levy would drive European finance firms to relocate to a post-Brexit London. Speaking directly as industry professionals, the signatories assured European leaders that financial firms base their complex relocation decisions on a multitude of structural factors far beyond a small transaction tax. They further highlighted the irony of this threat by pointing out that the United Kingdom already successfully applied a highly lucrative stamp duty on stock trades. To reinforce this point, the letter emphasised the proven, global track record of the policy. The signatories reminded the ten European leaders that deep, fast-growing financial markets in the United Kingdom, South Africa, Hong Kong, Singapore, Switzerland, and India all currently operated highly successful transaction taxes on particular asset classes, reliably raising billions of dollars every year without causing capital flight. Why It Mattered: Solidarity and Sector Reform The 2017 Financiers Letter remains a watershed moment in the campaign for financial reform, proving that the demand for a Robin Hood Tax was not merely an external political pressure, but a necessary market correction recognised by leading experts within the sector itself. Notable signatories included Lord Adair Turner, the former Chairman of the United Kingdom Financial Services Authority; Avinash Persaud, former head of Currency and Commodity Research at JP Morgan; and prominent academics such as Professor Stephany Griffith-Jones. The letter concluded with a powerful moral and economic imperative. The signatories declared that the introduction of additional Financial Transaction Taxes by the ten European nations offered a profound opportunity to restore the financial sector to its proper, socially useful role. Crucially, they reminded leaders that the substantial revenues generated must be directed toward those in the most urgent need, both at home and across the world's poorest countries.

The Case for Modernising a Historic Tax In May 2017, Professor Avinash Persaud of Intelligence Capital published a compelling blueprint for reforming one of the United Kingdom's oldest and most efficient taxes. Introduced in 1694, the stamp duty on share transactions successfully raised £3.3 billion annually for the exchequer at the time of publication. However, the report highlighted that the tax had not been meaningfully updated in thirty years, allowing the financial sector to exploit outdated exemptions amidst rapid technological innovation. Persaud argued that modernising the stamp duty was essential to guide the financial sector toward a sustainable business model in a post-Brexit landscape. Unlocking Billions in New Revenue The report identified that the intermediary, or market-maker, exemption was being heavily abused. Originally intended to protect genuine liquidity providers, the exemption was sheltering high-frequency traders and costing the exchequer almost £1 billion every year. By tightening this definition and offering a discounted rate rather than a blanket exemption, alongside expanding the tax to include corporate bonds and equity and credit derivatives, the government could generate massive returns. Persaud calculated that these specific reforms would raise an additional £4.7 billion per year, equating to an enormous £23.5 billion over the course of a five-year parliament. Curbing Systemic Risk and Churning Beyond pure revenue generation, the modernised tax would act as a powerful regulatory tool to improve systemic resilience. The report demonstrated that the financial sector had become increasingly reliant on short-term trading models that extracted wealth through excessive portfolio churning. By applying a transaction cost, the tax disproportionately impacts high-frequency traders who destabilise markets and drain liquidity during moments of crisis, such as flash crashes. Furthermore, it discourages the dangerous accumulation of massive gross derivative exposures that threaten the entire financial system during economic downturns. Eradicating the Relocation Myth Anticipating industry resistance, Persaud systematically dismantled the banking lobby's threat of relocating trades offshore. Because the stamp duty relies on the issuance principle, purchasers must pay the tax to secure a legally enforceable title to the asset, regardless of where the trade occurs or where the broker is located. For derivatives, the tax would utilise the residency principle. The report noted that modern international transparency initiatives, including strict anti-money laundering rules and mandatory central clearing under the European Market Infrastructure Regulation, have made it virtually impossible for traders to hide their beneficial ownership behind offshore shell companies. Ultimately, the 2017 report proved that modernising the stamp duty offers a readymade, enforceable mechanism to secure fair public revenues, punish reckless speculation, and protect the wider economy. We invite you to download and read the full report to explore the complete economic rationale supporting these vital reforms.

The Case for Reforming UK Stamp Duty Writing in April 2015, Professor Avinash Persaud of Intelligence Capital published a detailed analysis revealing how the United Kingdom could generate billions in additional tax revenues. During the 2013 to 2014 financial year, Her Majesty's Revenue and Customs successfully raised 3.1 billion pounds through stamp duties on stocks, shares, and other liable securities. However, this impressive figure masked a severe structural flaw, as a staggering 63 per cent of turnover in United Kingdom equities remained completely tax-exempt. This report exposed how the financial sector was exploiting these exemptions and outlined a clear strategy to reclaim the missing funds. The Abuse of Intermediary Relief The primary mechanism for this massive tax avoidance was the abuse of intermediary relief, traditionally known as the market-makers' exemption. Originally, this relief was designed solely to protect genuine market makers who provide essential liquidity by standing ready to buy and sell securities throughout the trading day. Instead, the exemption had been stretched to shelter High Frequency Trading and the non-market making activities of intermediaries. A massive portion of this untaxed turnover was generated by intermediaries actively hedging their end-customers' speculative activities in Contracts for Differences and Financial Spread Bets. By allowing hedge funds to gain exposure to share prices without officially purchasing the underlying shares, the financial sector successfully bypassed the stamp duty entirely. Calculating the Revenue Potential Persaud calculated that strictly redefining market makers and closing this intermediary loophole would generate between 1.2 billion and 1.9 billion pounds in additional tax revenues. This reform would instantly elevate the total stamp duty revenues from 3.1 billion pounds to a remarkable 4.3 billion or 5.0 billion pounds annually. To ensure accuracy, these calculations conservatively factored in the elasticity of trading volumes and the true, volume-weighted transaction costs faced by traders. Additional Exemptions to Target Beyond the intermediary loophole, the report targeted other unwarranted exemptions introduced by the government in 2014. The decision to exempt shares on growth markets, such as the Alternative Investment Market, cost the exchequer 170 million pounds in lost revenues without providing any meaningful boost to market activity. Similarly, extending stamp duty exemptions to collective investment schemes drained a further 145 million pounds. The report concluded that reversing these two specific loopholes would effortlessly raise an additional 315 million pounds with virtually no market disruption. Why the Stamp Duty Works Anticipating the banking lobby's standard threats of capital flight, the report highlighted why the United Kingdom's stamp duty is fundamentally robust and practically impossible to evade. Because the tax is legally tied to the transfer of ownership, a share purchase cannot be legally enforced unless the stamp duty has been paid. This ironclad mechanism forces foreign investors to comply, resulting in an estimated 40 per cent of the tax being paid by non-residents. Furthermore, the collection process is exceptionally efficient, costing just 0.09 pence for every pound collected, largely because 90 per cent of the revenue is automatically captured via the electronic CREST clearing system. We invite you to download and read the full report to explore the detailed economic analysis supporting the closure of these lucrative financial loopholes.

The Sovereign Bond Debate Following the European Commission’s 2011 proposal for a Financial Transactions Tax, a fierce debate erupted over its potential impact on financial markets, with particular anxiety focused on the sovereign bond market. For several Member States pursuing the tax, escalating national debt levels made the cost of sovereign borrowing a matter of acute political and economic sensitivity. Opponents of the tax seized on this vulnerability, claiming that levying the FTT on sovereign bonds would cause borrowing costs to skyrocket, ultimately costing governments more in increased interest payments than they would ever gain in tax revenue. This 2014 policy brief, written by a former senior financier at the request of Stamp Out Poverty, cuts through the fearmongering to provide a clear, empirical analysis of how the EU-11 FTT would genuinely affect the sovereign bond market. The paper breaks down the impact into three core areas: revenue generation, the cost of issuing new debt, and the structural alteration of the bond market itself. Revenue Generation: Repatriating the Profits The European Commission estimated that the proposed FTT would generate €34 billion annually, with €6.5 billion originating directly from the trading of sovereign bonds. After accounting for any potential increase in borrowing costs, the net profit to Member States was estimated at a substantial €3.85 billion. However, some governments feared that because their bonds are traded internationally, the resulting tax revenues might end up in the coffers of foreign nations, for instance, Germany collecting the tax on trades of Spanish bonds. The brief demonstrated that this fear ignores the reality of the "home bias" in the bond market. Domestic financial institutions hold a disproportionate and growing share of their own government's debt. At the time of publication, roughly two-thirds of Spanish and Italian sovereign debt was held domestically, a trend that accelerated rapidly following the financial crisis. Consequently, participating governments are guaranteed to capture the vast majority of the tax revenue generated from trading in their own bonds. Furthermore, the application of the "issuance principle" ensures that even when two institutions outside the EU-11 trade an EU-11 bond, the tax is still captured by the issuing Member State. The brief also highlights a significant, often overlooked revenue stream: EU-11 nations will collect the tax when institutions resident in their countries trade non-EU debt, such as the estimated $315 billion in US Treasury securities held by five EU-11 nations in July 2012. The Cost of Issuing New Debt: Why Yields Won't Spike The central threat propagated by critics was that investors, forced to pay a 0.1 per cent FTT, would demand a correspondingly higher yield from governments, perfectly offsetting the tax. The author dismantled this argument by highlighting a fundamental misunderstanding of the sovereign bond market: the FTT only applies to secondary market trading, not to the primary issuance of a bond. Crucially, many investors in sovereign bonds are "buy and hold" institutions. Pension funds and insurance firms are often legally obligated to hold government debt; for example, French pension funds are required to invest a minimum of 50 per cent of their portfolios in EU government bonds. Because these institutions hold the bonds until maturity, they will rarely pay the transaction tax, meaning they have no reason to demand higher yields. In Italy, a staggering 99.88 per cent of outstanding government debt sits untraded on any given day. Because demand for sovereign bonds is highly inelastic and alternatives are scarce, financial institutions must absorb the microscopic cost of the FTT rather than passing it onto the issuing government. The brief estimated that any pass-through to bond yields would be minimal likely 1 to 2 basis points (0.01 to 0.02 per cent), which is practically imperceptible when compared to the daily volatility driven by broader economic factors or European Central Bank policy. For context, Portuguese 10-year sovereigns fluctuated by an average of nearly 10 basis points every single day in late 2013, completely overwhelming the theoretical impact of the tax. Altering Market Structure for the Better Rather than harming the market, the brief argued that the FTT creates powerful incentives that actively increase financial stability. Because shorter-term bonds are traded more frequently for liquidity management, a uniform FTT impacts them more heavily than long-term bonds. This dynamic encourages governments to issue longer-maturity debt, a highly prudent strategy that reduces the amount of debt a nation must roll over during periods of market panic. Furthermore, the tax incentivises investors to place sovereign bonds in their "hold to maturity" portfolios rather than their "available for sale" portfolios. Moving bonds away from short-term, rapid-turnover trading and into the hands of stable, long-term investors reduces market volatility and protects both the issuing country and the investing bank from sudden economic shocks. Ultimately, this policy brief concluded that the importance of sovereign bonds to European economies does not undermine the case for a Financial Transaction Tax; rather, the stabilising effects and robust revenues actively reinforce it. We invite you to download and read the full policy brief to explore the data and analysis dismantling the myths surrounding sovereign bonds and the FTT.