Newsletter : Special Update

Brown Champions Tax on Banks

After 10 years of campaigning, a day some thought impossible has arrived: the UK government – and Gordon Brown himself – are calling for a tax on the banking sector, a fair proportion of which will be spent on international development.

This is a huge step forward for the campaign and a vindication of all the hard work of our supporters over the years. Only two weeks ago nearly 1,000 of you sent a letter to Gordon Brown calling for the UK to implement a Currency Transaction Levy and ensure something positive comes from the financial crisis, and that we do not simply return to ‘business as usual’.

Gordon Brown reflected this in his politically-charged speech to G20 Finance Ministers, last Saturday 07 November: “there must be a better economic and social contract between financial institutions and the public… it cannot be acceptable that the benefits of success in this sector are reaped by the few but the costs of its failure are borne by all of us."

The Government is championing the introduction of a Financial Transaction Tax – a move already supported by France and Germany. The proposal is for a small levy (0.05%) to be applied to various categories of financial transactions including, stocks, bonds and currency. Unlike a Currency Transaction Levy, it would require global agreement, but has the potential to raise more than £400 billion a year.

For an explanation of the difference between a Financial Transaction Tax and a Currency Transaction Levy, click here.

The story has received widespread coverage in the press. Click here for one such article written by commentator Will Hutton, published in the Observer the day after the Prime Minster’s speech.

As the inevitable squawks of disapproval come from City institutions such as the British Bankers Association, they seem increasingly out of touch with the public and political mood that the banking sector must be held accountable and made to pay for the mess they caused.

Let us celebrate this landmark step for the campaign and intensify our efforts to ensure that something positive does indeed result from this financial crisis.

Thank you for your support,

The Stamp Out Poverty Team