Osborne expected to oppose EU's proposal for Tobin tax on banks

Chancellor's office indicates that he will not support European commission's proposals for EU-wide financial transaction tax

http://www.guardian.co.uk/business/2011/se...P=FBCNETTXT9038

 

The proposed EU tax on financial transactions, which could raise €57bn a year and force banks to make a "contribution back to society", is expected to face fierce opposition from George Osborne.

 

Within minutes of José Manuel Barroso, the president of the European commission, setting out plans for a transaction tax – often known as a Tobin tax or Robin Hood tax – the chancellor's office made it clear that the City would not tolerate an EU-wide tax on transactions.

 

Barroso, who outlined proposals for the tax in his state of the union address, said it was time for banks to pay back their debt to taxpayers. "Today, the commission adopted a proposal for the financial transaction tax. I am putting before you a very important legislative text," he said in Strasbourg.

 

"In the last three years, member states have granted aid and provided guarantees of €4.6tn to the financial sector. It is time for the financial sector to make a contribution back to society," he added, as he also insisted the commission intended to clamp down on tax avoidance.

 

"It is not only financial institutions who should pay a fair share. We cannot afford to turn a blind eye to tax evaders," he said.

 

The tax has the support of French president Nicolas Sarkozy – currently chairing the G20 – and the commission hopes he will put it on the table at the next G20 summit in Cannes, when heads of state will gather on 3 and 4 November.

 

Osborne has opposed an EU-wide financial transaction tax in the past, although is prepared to consider a global version. The Treasury said: "The government will continue to engage with its international partners on financial transaction taxes and has no objection to them in principle. But any financial transaction tax would have to apply globally and there are a number of practical issues that need to be worked through. These issues are underlined by the commission's own analysis."

 

But campaigners for the tax took issue with the Treasury's stance. David Hillman, spokesman for the Robin Hood tax campaign, said: "While the UK government defends the interests of the City's privileged few, this shows Europe is ready to ensure banks pay their dues to society."

 

TUC general secretary Brendan Barber urged the government to support the idea. Barber said: "It would also help rebalance the economy, address the under-taxing of the financial sector, and reward long-term investment."

 

Under Barroso's proposal – which he claims has the support of 65% of European citizens – a minimum tax rate on trading of bonds and shares would be set at 0.1% and 0.01% for derivative products and be levied on trades where at least one of the institutions is based in the EU. On this basis, the tax could raise around €57bn (£50bn) per year if implemented on 1 January 2014.

 

Opponents argue it could stifle growth and damage the City. Sam Bowman, head of research at the Adam Smith Institute, said: "The Tobin tax or financial transaction tax proposed by José Manuel Barroso would achieve exactly the opposite of what the EU wants. It would increase volatility by forcing traders to make fewer but bigger trades, which would create bigger lurches up and down on financial markets."

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Blah, Blah, Blah, Gideon.... For once the Tories could actually do the right thing, the POPULAR thing too, and back this (as the overwhelming majority of the country would support this I suspect), but no, his only concern are with this banker chums in the City, to hell with what's beneficial for society at large.... And here was me thinking that the "Coalition" actually wanted to plug the deficit... A "Tobin Tax" on banks would go quite a bit of the way to achieving this goal.....

 

His whole argument that the tax should be "global" is just silly.. Not every country in the world has put massive State investment into their banking sectors, so why would they tax their own banks..? The Tobin Tax is about society getting back the money that was put in by the tax-payer... How much did the tax-payers of, say, Russia, China, Canada, Switzerland, Australia or Brazil put into their banks...?? I dont recall ANY of these countries having to bail out their banks.. What Gideon really means is, "we'll only support it when Washington and Wall Street say it's okay"..... F/uck you Osborne you're a tool (of the bankers)..... <_<

Kind of conclusive proof that the vicious Tory right of old has begun to dominate the wishy-washy "we'll do anything as long as it's popular" stance typified by Cameron's time in opposition. We're talking £50 BILLION here, that would slash the deficit by ONE THIRD (how much did scrapping EMA raise?) and yet they're going against not just common sense but popular opinion. The main fear of imposing this tax in the UK was that businesses would move abroad to complete transactions, but if it's an EU-wide policy then that kind of shuts that argument off. The ONLY possible shred of reasoning in favour of not adopting it is that now European business will come over here to avoid the tax, but that's hardly likely to raise anything close to the figures we're talking about...

 

Miliband passed the "let's stick the knife in over News International" test admirably over the summer, now if he's got any sense he'll absolutely destroy Cameron over this. Either that, or let Balls loose on Gideon :lol:

Kind of conclusive proof that the vicious Tory right of old has begun to dominate the wishy-washy "we'll do anything as long as it's popular" stance typified by Cameron's time in opposition. We're talking £50 BILLION here, that would slash the deficit by ONE THIRD (how much did scrapping EMA raise?) and yet they're going against not just common sense but popular opinion. The main fear of imposing this tax in the UK was that businesses would move abroad to complete transactions, but if it's an EU-wide policy then that kind of shuts that argument off. The ONLY possible shred of reasoning in favour of not adopting it is that now European business will come over here to avoid the tax, but that's hardly likely to raise anything close to the figures we're talking about...

 

Miliband passed the "let's stick the knife in over News International" test admirably over the summer, now if he's got any sense he'll absolutely destroy Cameron over this. Either that, or let Balls loose on Gideon :lol:

 

Scrapping the EMA "saved" £550m allegedly... Of course, 10 years of EMA grants could've been paid for just by getting the tax that Vodafone owed the country.... -_-

 

The argument that was used before regarding the Tobin Tax was "we cant go it alone"... Well, that argument is short-circuited now by the fact that the EU has adopted it and is rolling it out all over the EU... Now it's "errrr, we have to wait til it's Global".... Gideon's a f**king twat.... <_< And where are the Lib Dems on this issue now.. I seem to remember them being in favour of the Tobin tax... I imagine their position now is waiting for Cameron to tell them what position to have..... -_-

This really does make you despair doesn't it? Of course, ideally it would be implemented globally. But we all know that's not going to happen. Osborne is just using it as an excuse to hide the fact that he doesn't support it because that's what his banker chums have told him.

This really does make you despair doesn't it? Of course, ideally it would be implemented globally. But we all know that's not going to happen. Osborne is just using it as an excuse to hide the fact that he doesn't support it because that's what his banker chums have told him.

 

Spot on...

 

Banker chums + Washington though, I suspect.... I can pretty much guarantee that if the Yanks were doing this, we'd be doing it too...

 

The Tory Party is turning into the European Tea Party. Osbourne would never support any type of tax that was a burden not just on his banker chums but his family and friends who are all top earning toffs and many I am sure have directorships with the major banks or contacts in the City. There will be no attempt by the Tories and the Libdem Uncle Toms to rightfully increase the tax burden on the banks or the haves because that is not who votes for them and keeps them in power. Those who can least afford to pay more the poor and disadvantaged will have more and more stringent cuts in benefits, assistance and facilities. Even if the money raised by bank taxes would be double that of cuts in social services Osbourne does not care.

 

Well, here we see the real reason why the Tories are so reluctant to bring in a Banker Tax....

 

http://www.guardian.co.uk/politics/2011/se...P=FBCNETTXT9038

 

City's influence over Conservatives laid bare by research into donations

Donations from finance account for half of payments to Tories since 2010 general election

 

The influence of the City over the Conservatives is laid bare by new research showing that more than half of the Tory party's donations since the general election have come from individuals and businesses working in finance.

 

Hedge funds, financiers and private equity firms contributed more than a quarter of all the Tories' private donations – which this year poured in at a rate equal to £1m a month – the study by the Bureau of Investigative Journalism has found.

 

The figures show an increase in the proportion of party funds coming from the financial sector, raising fears that the City's financial influence over the Tories is on the rise as key pieces of legislation are discussed by the coalition government.

 

They come amid growing concerns that some parts of the financial sector, described by Labour leader Ed Miliband this week as "asset strippers" or "predator financiers", are profiting from financial instability.

 

The senior Labour shadow minister Peter Hain said the figures confirmed that the Tories remain wedded to the few who do well out of the financial and political system. The Liberal Democrats used the research to step up their campaign for changes to party funding.

 

The Bureau of Investigative Journalism has mapped, for the first time, donations to the Tories from business to the year ending 30 June.

 

Using analysis from the Electoral Commission and Companies House databases, the researchers found City donations in the 12 months to July accounted for 51.4% of the £12.2m of funds received by Central Office. Hedge funds, financiers and private equity firms contributed £3.3m – some 27% – while 50 City donors paid over £50,000. All donors contributing this amount or more become members of the Leader's Group and qualify for a face-to-face meeting with the prime minister.

 

The largest contributor across all the business sectors studied by the bureau was hedge funds which donated £1.38m (11.4%). Three of the City's biggest name hedge fund bosses – Michael Farmer, Lord Stanley Fink and Andrew Law – together contributed £636,300. Fink is the party treasurer. The top financier donor was David Rowland, who contributed £1.1m. Rowland has a colourful City career and was forced to resign as party treasurer before he even took up the job because of links to tax havens. He now controls Banque Havilland – which used to be the crashed Icelandic Kaupthing bank business – in Luxembourg and the hedge fund Blackfish Capital Management.

 

Outside the City, the sector that donated most was industry, including manufacturing and defence. This sector contributed £913,411 (7.5%). A company controlled by Michael Spencer, another former Conservative party treasurer, donated £163,350. He is campaigning against the EU's attempts to introduce a transaction tax on financial trades and threatened on Fridayto shift some of his company's operations from London "extremely rapidly" if the tax is introduced.

 

Peter Cruddas, the multimillionaire currency trader who grew up on a Hackney housing estate and left school with no qualifications, handed over £123,600, while his business, CMC Markets UK, donated £100,000. He is co-treasurer of the Conservative party, alongside Fink.

 

But while Spencer and others are now campaigning against potential tax changes, since the coalition came to power several key measures have been introduced that could benefit the Conservative's City backers. Among them is a commitment to reduce corporation tax to 23% by April 2014 and exempting UK resident companies from corporation tax on all profits for their foreign branches.

 

The figures show the insurance sector has donated £189,400 as the government discusses radical plans to slash the legal aid budget – a measure which critics claim will benefit insurers. Construction companies have donated more than £220,000 amid a lobbying campaign to relax planning rules covering the green belt.

 

In a separate survey, the Labour MP John Mann disclosed figures that show that the top three donors – Rowland, Farmer and Fink – have donated almost £10m since 2005. Stuart Wilks-Heeg, executive director of Democratic Audit, said: "What this study tellingly reveals is the scale of the Conservative party's reliance on a variety of City interests at a time when the Conservative-led government is attempting to kick banking reform into the long grass," he said.

 

Hain said: "The Conservative party has long since been over reliant on donor income from people at the top of the income scale.

 

"No wonder David Cameron and George Osborne are straining at the leash to cut tax for people earning at least £150,000 a year while asking everyone else to pay the bill for a financial crisis caused by the banks," he said.

 

The Liberal Democrat peer Lord Oakeshott said: "Big financiers are still the Tories' big backers with hedge fund gamblers and private equity asset strippers leading the way. Labour is being bankrolled by the union bosses. The coalition must act now to clean up party funding."

 

Who gave what?

 

From the celebrity hairstylist to the Oscar-winning screenwriter, Haroon Siddique profiles a dozen top Tory donors

 

David Rowland, property developer: £1,160,936

 

Notoriously camera-shy, Rowland was by a distance the Conservatives' largest donor last year. The former tax exile was set to become party treasurer last year but resigned shortly before he was due to start.

 

Michael Bishop, former airline head: £335,000

 

Was one of the country's first openly gay senior executives when he headed BMI. Sold stake in airline to Lufthansa for £318m in 2008.

 

May Makhzoumi, fibreglass pipe manufacturing and supply business: £308,000

 

The biggest individual female donor. Wife of the Lebanese businessman Fouad Makhzoumi.

 

JCB Research, industrial equipment company: £300,000

 

Subsidiary of the Bamford family's JCB digger empire. JCB chairman Sir Anthony Bamford was nominated for a peerage by David Cameron last year, but withdrew his nomination.

 

David Whelan, fitness clubs & football club owner: £100,000

 

The founder of JJB Sports sold up in 2007, then later bought its fitness clubs. Also owns Wigan Athletic football club.

 

John Frieda, hairdresser: £50,000

 

Celebrity hairstylist with salons in London, New York, Los Angeles and Barbados. Sold his hair care products business to a Japanese corporation for £290m in 2002.

 

Jeremy Isaacs, private equity firm co-owner: £50,000

 

Left role as head of Lehman Brothers' European and Asian operations days before bank went bankrupt in 2008. Later co-founded private-equity group vehicle JRJ group.

 

Hans Rausing, ex-packaging tycoon: £49,000

 

Co-inherited Sweden's Tetra Pak group, the world's largest packaging production company, then sold out to brother Gad in 1995 for an estimated $7bn. Wife Marit also donated £49,000 last year.

 

Julian Fellowes, writer and actor: £40,000

 

Won an Oscar for his first Hollywood screenplay, Gosford Park, and created the hit ITV series Downton Abbey. Was made a Conservative peer in January.

 

Annabel's, private members restaurant & nightclub: £20,000

 

Legendary central London society haunt, frequented over the years by Frank Sinatra, Aristotle Onassis, assorted royals and David Blunkett.

 

Mike Batt, composer: £20,000

 

Composed such classics as Remember You're a Womble and the theme to Watership Down. Took over composing Tory election themes from Andrew Lloyd Webber and often donates in kind through music.

 

Bell Pottinger, PR group: £11,900

 

As representative for Trafigura, tried to prevent media revelations about the oil company's involvement in toxic waste dumping in Africa. Also represents the government in Bahrain.

 

 

This isn't exactly shocking news. However, what galls me is that the Tories keep banging on about how Labour policy is (overtly) influenced by their paymasters (the unions) but keep quiet about how their own policy is influenced (far more covertly) by their paymasters. As is so often the case, they're just a bunch of hypocrites.

 

The Lib Dems, of course, have only ever had one big paymaster and he was more interested in gaining phoney respectability than any influence over policy.

This isn't exactly shocking news. However, what galls me is that the Tories keep banging on about how Labour policy is (overtly) influenced by their paymasters (the unions) but keep quiet about how their own policy is influenced (far more covertly) by their paymasters. As is so often the case, they're just a bunch of hypocrites.

 

The Lib Dems, of course, have only ever had one big paymaster and he was more interested in gaining phoney respectability than any influence over policy.

 

...And the Unions are at least democratically accountable institutions.... Members vote for leaders ans Stewards... I dont remember anyone voting for who gets to be the CEO of a big banking institution..... -_-

Question asked Question answered-Over half of the donations received by the Conservative Party in the last year were from the financial services sector, a report published on Saturday revealed.

A study conducted by the Bureau of Investigative Journalism has found that the proportion of donations to the party that came from the financial services sector was 51.4 per cent - up 0.6 per cent from last year. Protecting friends more like all on the same sinking ship so need to prop up each other-just disgusting.

I seriously hope the Tobin Tax does end up being implemented. While it wouldn't bring the end of all our problems, I fail to see how it won't significantly help.