Tobin tax

A Tobin tax is the suggested tax on all trade of currency across borders. This is supposed to put a penalty on short-term speculation in currencies. The proposed tax rate would be low, between 0.05 and 1.0 per cent.

Related Topics:
Tax - Trade - Currency - Speculation

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The name comes from the economist James Tobin. It was in 1972, soon after the Nixon administration pulled the United States out of the Bretton Woods system, that Tobin suggested a new system for international currency stability, and proposed that such a system include an international charge on foreign-exchange transactions. Professor Tobin later received a Bank of Sweden Prize in Economics in 1981, and his name will evermore be fixed to this idea.

Related Topics:
James Tobin - 1972 - Nixon - United States - Bretton Woods system - Bank of Sweden Prize in Economics - 1981

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The idea lay dormant for more than 20 years. In 1997 Ignacio Ramonet, editor of Le Monde Diplomatique, renewed the debate around the Tobin tax with an editorial titled "Disarming the markets". Ramonet proposed to create an association for the introduction of this tax, which was named ATTAC (Association for the Taxation of financial Transactions for the Aid of Citizens). The tax has then become an issue of the antiglobalization movement and a matter of discussion not only behind academic institutions but even in the streets and in Parliaments of all the world.

Related Topics:
1997 - Ignacio Ramonet - Le Monde Diplomatique - ATTAC - Antiglobalization

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