A global tax on the world’s big banks to help poor countries survive the economic crisis must be urgently agreed, Oxfam said today ahead of the G20 meeting of Finance Ministers in South Korea.
Treasurer Wayne Swan will attend the meeting, which is due to have a proposed financial sector tax on the agenda.
International development agency Oxfam, along with other aid agencies and organisations, are pressing for a bank tax – or Robin Hood Tax – that will raise as much as $474bn (US $400bn) a year.
Half of that 400 billion would be spent on domestic issues like health and education in countries that levy the tax – like Australia – while the other half would be spent on climate change adaptation and poverty reduction in poor countries around the world.
Recent media reports suggest big Australian banks have profited from the financial downturn, because they have charged borrowers more than the increase in their costs.
Oxfam Australia executive director Andrew Hewett said this was a once-in-a generation opportunity for the G20 to reshape the global economy in favour of poor people.
“We can never return to a situation where the greed of the richest takes precedence over the needs of billions. However the G20 chooses to structure the tax, it should not just bail out banks, it should also bail out the world’s poorest people.
“A financial sector tax is the best option to deliver the scale of resources needed to recover from the financial crisis. The G20 must now seize the moment and deliver a tax that will raise resources to tackle poverty and climate change.
“Wayne Swan and the other finance ministers meeting in South Korea must agree a roadmap for taxing the financial sector, and the deal must be closed at the G20 Leaders Meeting on 26 and 27 June in Toronto, Canada.”
The International Monetary Fund (IMF) has supported the idea of a tax on banks, giving its preliminary report on a financial sector tax to G20 finance ministers in April. The IMF proposed two taxes to repay the costs of the global economic crisis and to fund the response of crises in the future. The two taxes would take the form of a levy payable by all financial institutions, and a tax on their profits and pay.
The G8 has broken its promise of $59bn (US $50bn) in aid to poor countries by 2010, and 50,000 more children in Sub-Saharan African countries died last year because of the financial crisis.
Oxfam is part of a broad alliance of development organisations, unions and environmental groups supporting the Robin Hood Tax.
For more information please contact Laurelle Keough on 0409 960 100 or laurellek@oxfam.org.au
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