French bank becomes the first to introduce Tobin Tax

Bank says tax will raise €100,000 per annum for Millennium Development Goals

France’s co-operative bank, Crédit Coopératif, has become the world’s first to voluntarily start paying a Tobin Tax on currency transactions.
At a conference in Paris on May 3, the bank announced that it was earmarking 0.01% from all interbank currency transactions (spot and outright on foreign exchange market) – which it said would generate €100,000 in a year – that it will hand over to development agencies working to advance the Millennium Development Goals. The move could put pressure on other banks, notably in France, to follow suit. The Tobin Tax was originally put forward in the 1970s by Nobel Laureate economist James Tobin as a tax on all spot conversions of one currency into another. It intended to penalise short-termfinancial round-trip excursions into another currency. Recently, it has received notable support recently from the French President, Nicholas Sarkozy, and been picked up in a form by activists in the UK as the Robin Hood Tax on short-term trading. The French bank said it had started collecting the Tobin Tax contributions on March 1st. It said the bank would meet the full costs of the tax with no increase of banking charges for clients; a response to critics of the tax who say that banks will merely pass on the cost to the public.
Crédit Coopératif was created in 1893 and specializes in financing of areas of social economy, microfinance and the environment.