2 Responses

  1. Peter Graves
    Peter Graves March 11, 2016 at 12:48 pm

    Thanks Garth and Bob
    We do need new taxes for the 21st century, as the additional revenue paying for the services we expect of Government. Like the three main “cares”: child; health care; aged. Or foreign aid.

    An alternative is a new (Tobin) Tax of about 0.01% applied to high-frequency foreign exchange transactions. A year ago, the Chairman of ASIC claimed that “Australia is being picked off by highly-leveraged, online foreign exchange brokers”. http://www.smh.com.au/business/markets/currencies/asics-greg-medcraft-says-foreign-exchange-brokers-are-picking-off-australia-20150322-1m499a.html%5D

    The Reserve Bank calculated FOREX trades in April 2013 averaged US$182 billion each day. By contrast, the Department of Foreign Affairs and Trade reported Australia’s two-way trade in 2012 was $623.8 billion, or about 4 days FOREX trading. This suggests over 90 per cent of these trades are speculative.

    A Tobin Tax would mean a possible extra $18 million each day in Government revenue. Taxing the speculators would provide the extra revenue for Australia’s aid budget, e.g. child immunisation, clean water and education.

  2. Bob McMullan
    Bob McMullan March 9, 2016 at 2:41 pm

    Thanks Luke. This is a very important and thought provoking piece of work. I would not advise the aid NGOs and other aid advocates to rush into the taxation debate too quickly, but some sober reflections on the data in this article might lead to some interesting options.

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