On the Currency Transaction Tax

A text on the Currency Transaction Tax (CTT), the problems raised as regards its feasibility and possible solutions.

David Hillman, January 2005

To download : PDF (58 KiB)

Summary :

The Currency Transaction Tax (CTT) means a lot of different things to many different people depending on the perspective one brings to it. In the ‘Another World is Possible’ Movement we can discern two specific strands: i) against the domination of capital and the severe damage the currency trade can cause; ii) the redistributive benefit that can be achieved through deriving taxation revenue from the vast amounts of currency traded ($2,000 billion each day). Stamp Out Poverty - a network of more than 50 UK charities, trade unions and faith groups - has concentrated over the last year on focusing specifically on the revenue-raising potential of the CTT to increase financing for development. To get a clear answer over the issue of feasibility of a tax on foreign exchange transactions, Stamp Out Poverty asked a leading financial advisory firm in the City of London, Intelligence Capital, to investigate whether a very low tax on Sterling transactions could be implemented, how such a levy could be plumbed into the international financial system and whether this could be achieved without a relocation of sterling currency trading. Their report ‘A Sterling Solution’ was published in November 2005. It demonstrates how it is not necessary for a currency transaction tax to be universally implemented: it could be introduced unilaterally by any country or currency zone that wished to do so.

See also: