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CESR joins letter to EU Heads of State on Financial Transactions Tax

June 27th, 2012

As European finance ministers and heads-of-state prepare for their latest summit in Brussels, CESR has joined a coalition of 20 other human rights and social justice organizatons in calling for bold leadership on the much-needed financial transactions tax.

In their efforts to find a way through a seemingly-endless sovereign debt crisis, the decision-makers meeting in Brussels will be well aware of the growing economic doubts over an austerity drive that has severely undermined economic and social rights in the region. The proposed “FTT”, which already enjoys the support of nine European states, would mark an important step towards more effective and human rights-centered management of the financial system.

In order to comply with their obligations under international human rights law, national governments are obliged to cooperate in the mobilization of the maximum of available resources to provide social services while also battling widening income inequality. Given that the FTT offers a means to reintroduce a measure of equality and progressivity into taxations systems, it would serve as an important tool in this regard. It is estimated that it would generate about $48 billion per year, if implemented across the G20 at its lowest rate, with higher rates yielding up to $250 billion. By tempering the kind of opportunistic speculation that contributed to the economic crisis in the first place, the FTT could also help governments prevent human rights abuses by third-parties, such as private financial actors, and thereby go some way to satisfying governments' duties to protect human rights. Once implemented, the FTT would also represent the delivery of a small measure of accountability for the costs of the crisis, which is likewise required in order to comply with human rights law.

So far a coalition of ten countries, including Germany, France, Spain and Denmark, are backing the initiative, but staunch opposition remains in a number of other states such as the United Kingdom. The willing states are likely to press ahead, using the European Union’s “enhanced cooperation” mechanism, in order to implement the FTT on a limited basis in the hope that it will later be rolled out to all 27 member states. Taking into account the ongoing tension between the two camps within the European Union, the civil society coalition campaigning for the introduction of the FTT issued two letters, one to supportive governments and the other to those administrations that remain skeptical. Both letters can be acccesed in pdf format below:

The organizations supporting the letters are:
  • Association for Women's Rights in Development (AWID)
  • ATTAC Spain
  • ATTAC Switzerland
  • Center for Economic and Social Rights (CESR)
  • Center of Concern (USA)
  • CIVICUS
  • CNCD-11.11.11 (Belgium)
  • Development Alternatives with Women for a New Era (DAWN)
  • ESCR-Net Economic Policy & Human Rights Working Group
  • Friends of the Earth (USA)
  • Global Social Justice (Belgium)
  • Institute for Policy Studies –Global Economy Project (USA)
  • International Cooperation for Development and Solidarity (CIDSE)
  • IBASE (Brazil)
  • L’Espace Associatif (Morocco)
  • Oxfam International
  • Philippine Rural Reconstruction Movement (PRRM)
  • Social Agenda Working Group (Thailand)
  • Social Watch
  • UBUNTU – World Forum of Civil Society Networks
  • Voices of Community Activists & Leaders (VOCAL-NY)