The "Robin Hood" Tax

This tax is named after James Tobin who is a Nobel Prize-winning economist, it was originally designed to hinder volatile currency trading and also had the potential to help developing nations, but many supporters now say it is one way to ensure that banks do not take excessive risks that could trigger another financial crisis.

The large amounts of money raised by the “Robin Hood” Tax would help protect public services and jobs, as well as fight poverty and tackle climate change.

The IMF has to back the plans for a “Tobin Tax” on international transactions in order to solidify the scheme within the European Union.

A campaign member said: "This is a tax on speculative banking, the kind of gambling that went on that got us into trouble."

He continues: "The banks have been bailed out to the tune of 9 trillion dollars. It's symmetry that the banks should therefore not only make good the damage caused by the economic crisis but should also perpetually become a useful thing in society."

In recent months, although they have similar plans, governments and bankers have been focusing on insuring against future banking crashes instead.

Just last month, the World Economic Forum (WEF) discussed a levy on financial institutions that would be used to help bail out banks in any future crisis. The call was backed by politicians and the International Monetary Fund (IMF) at the WEF's meeting in Davos.

If the Robin Hood Tax is put into place, the tax would not be levied on banks' transactions with their High Street customers. Instead it would only apply to transactions between financial institutions, with different rates applied to different types of transaction - with an average tariff of five pence for every £1,000 traded.

What the campaign is calling for is for countries that levy the tax to keep half the earnings domestically and for the rest to be split 50-50 between poverty reduction and tackling climate change. According to estimates made by the group, the “Robin Hood” tax could raise tens of billions of pounds for the UK, which it says could be used to help cut the public deficit too.

In a letter addressed to the leaders of the UK's political parties, the campaign says: "We would ask you seriously to consider the Robin Hood Tax as that radical new option - a small tax on bankers that would make a huge difference to the UK, to the poorest countries and to our planet.

"Let's turn the crisis for the banks into an opportunity for Britain and the world."

Nevertheless, it is important to state that any plans to implement an international tax would need international backing. These plans have received a less than positive reaction from both the US and the IMF.

Last year at the G20 meeting, the IMF head Dominique Strauss-Kahn, described a tax on financial transactions as "a very old idea that is not really possible today". The UK's British Bankers' Association also questioned the feasibility of the plan. The BBA’s spokesman, Brian Mairs, said it was fatally flawed, "because it requires all of the world's tax jurisdictions to agree to it, all at once. It's inconceivable and impractical at this stage".

Now, from all the articles I have read about the Tobin Tax in the FT, BBC, Telegraph, etc. I can not help but contemplate how naive some governments really are. We are in this mess today because of the banks, is it then really correct to even think of saving banks from future taxes? I don’t think so. There seems to be an unparalleled point of misunderstanding between political parties as well as financial institutions. I personally fully endorse this campaign as I see it as an ultimate crisis solving scheme. Furthermore, governments would have the additional resources to fund poverty and climate change without having to raise income taxes or any of the sort. All the money generated from this tax can only improve our economical positions of the future and I think it would be wise to start with it soon before it is too late to act.