Who’ll move first to support the Robin Hood tax?
So who will be first to support the international ‘Robin Hood Tax’ – Kevin Rudd or Tony Abbott?
We can leave Mr Rudd to Gordon Brown to persuade. The question is whether a modern day Friar Tuck could tap into Mr Abbott’s policy pragmatism (or idealism, depending on your point of view) to persuade him to commit the Coalition to this great idea. Or perhaps Angela Merkel’s conservative lead on the proposal would be enough.
The proposal is for a 0.05% tax on international financial transactions. This small tax could raise approximately US$400-billion a year for investment in hospitals, or clean energy infrastructure, or water programs, here and in developing countries, to suggest three examples.
Communities in Australia and around the world need and demand more investment in infrastructure. They need more programs that promote the common good by underpinning growth in human capital and removing barriers to productive involvement in the economy.
We know that private investment should be a priority. But we also know that public revenues need to be raised and allocated, and we need clever taxes that are not so burdensome as to be counterproductive. Putting such a small tax on the transactions that have come to dominate international finances, but that have thus far escaped the taxation net, would be a simple and strategic policy move.
Australian voters will be asked in the near future to make up their minds about the Henry Tax Review, and about preferred paths to tax reform. We know that our challenge in the next few budgets is to prevent the public debt created by the government’s stimulus initiatives to blow out further. We also know, though, that considerable public infrastructure issues remain to be addressed. Amongst most voters there is also commitment to public investment in clean energy infrastructure.
Moreover, we know that the productivity of poorer countries in our region could be boosted considerably by tackling their public infrastructure and public health needs, and that we would benefit as a country in the generation of global wealth that followed.
Renowned capitalists George Soros and Warren Buffet as well as Mrs Merkel have given their backing for the proposed tax, so Tony Abbott would not be out of place in arguing this case in the Coalition party room. It would be a natural element in any social democratic re-working of the tax system by Mr Rudd.
So who will be the lead Australian ‘merry-man’ in supporting the new ‘Robin Hood Tax’ – Mr Rudd or Mr Abbott?
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