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Robin Hood Tax

The Robin Hood Tax [3] is a collection of financial transaction taxes similar to the Tobin tax, proposed in the United States. The Tobin tax, suggested by Nobel economist James Tobin, was a tax on all spot currency conversions and designed to penalize short term forex trades. The Robin Hood Tax is broader and would add a tax to a variety of financial transactions from currency exchange to stock trades to bond sales. It would also include a levy on banks and other financial activities (called a FAT tax).

Why Robin Hood? He stole from the rich and gave to the poor. This tax would steal from the rich (bankers) and give to the poor (social programs) too and the idea has the support of over a thousand economists [4].

How much would the tax be? On transactions like stock trades and the like, it’d be 0.05%. On a purchase of $1,000 in stock, you’d expect to pay 50 cents. If you’re a savvy buy and hold type, you won’t even notice it. The real money makers are those mega-traders who use arrays of computers and transact in the tens and hundreds of millions of dollars each day.

What do you think of this idea? I love it.

(Photo: Oxfam [5])