Global Tax Gets Another Look
LONDON – Proposals to pay for international aid, peacekeeping, and other humanitarian causes through global taxes have long been shunned by the US Congress. Suggestions range from an international lottery to a tax on the arms trade. But one idea – a tax on foreign currency transactions – may have a better chance after the currency fluctuations that crashed the “Asian miracle.”
Although congressional Right-wingers see it as a plot against US sovereignty, cuts in Western aid budgets and recent economic jitters are reviving consideration of the so-called Tobin Tax. Originally suggested by US Nobel laureate James Tobin, a tax on currency transactions supposedly would discourage trading and reduce exchange-rate volatility. With $1.2 trillion washing through the global economy every day, the proceeds could reach $80 billion a year. Princeton economist Peter Kenan suggests that funds be used for projects like disaster relief, AIDS research, and environmental clean-ups.