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Bill Gates proposes a Financial Transaction Tax to G20 to Fund Development
Bill Gates has given his support to a campaign to put a small tax on financial trades (known as a Financial Transaction Tax - FTT). In a note presented to the G20 he proposes to generate up to $48billion in revenue on a G20-wide basis which can be then used to fund spending on development.
Even if the FTT were to be confined to larger European economies $9bn would be generated. Social Justice Ireland has advocated for years for such a tax and proposed the income should be used to tackle poverty and climate change across the world with particular focus on achieving the Millennium Development Goals.
The FTT is a credible mechanism by which to generate substantial amounts of money to help fill the climate fund and finance other global challenges, without requiring additional sacrifices from the taxpayer.
In practice, the FTT would mainly impact short-term trading which has no added value for the real economy and contribute to the stabilisation of financial markets by reducing speculation. While it is widely acknowledged that the tax can be put in practice (including 2010 studies by the International Monetary Fund and the European Commission confirming its feasibility), the necessary political will is lacking. Countries like Germany, France, Belgium and Luxemburg are supportive, many others including the United Kingdom, the United States and the Netherlands are still unwilling to consider taxing financial transactions.
Those who oppose this proposal should realise that if the well-being of people and the planet are at risk, the future of the financial sector is too. The right thing to do now is to put people first, supporting the introduction of a Financial Transaction Tax for a better future.
For the rationale behind Bill Gates proposal click here.