Tuesday, September 21, 2010

Tax on financial transactions brought up at UN

A world wide tax on financial transactions was mentioned during a couple of speeches at the United Nations yesterday. While world leaders meet at the UN to talk about the Millennium Development Goals this idea to drum up some financing for development projects was brought up to its widest audience.

French President Nicolas Sarkozy and Spanish Prime Minister Jose Luis Rodriguez Zapatero asked the UN members to decide on implementing the new tax on global financial transactions. Many business leaders are opposed to the tax saying that it could prevent such transactions from being exchanged with the under-developed world.

From Canada.com, writer Steven Edwards gives us this angle of the events at the UN.

While the leaders of several developed countries have pressed the idea of launching a global finance tax before, speaking about it anew at such a widely attended summit gives it added weight.

The idea has also garnered growing attention as numerous developed countries, such as Canada, have announced plans to limit upcoming foreign aid transfers against the backdrop of the global recession.

"We can decide right here; why wait?" said Sarkozy. "Finance has globalized, so why should we not ask finance to participate in stabilizing the world by taking a tax on each financial transaction?"

Zapatero said alternative financing was needed that is "not as vulnerable" as rich-country budgets during a recession.

"My government is committed to defending the new tax, and making it a reality . . ." he said. "It appears sensible, just, and logical that we ask (for this) minimum effort to take millions of people out of misery."

Zapatero's government cut its development aid in the face of the financial crisis. By contrast, Canada's aid budget for the new fiscal year is — at $5.165 billion — at a record level ahead of the announced freeze next year.

The three-day conference aims to review the world's progress in achieving eight development goals meant to halve levels of poverty and dramatically increase living standards among the world's poor by 2015.

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