Editing Tobin tax (section)

===Pros and cons if the Tobin tax (FTT) were implemented?===
{{See also|Financial transaction tax|Let Wall Street Pay for the Restoration of Main Street Bill}}

====Views of ABAC ====
The [[APEC Business Advisory Council]], the business representatives' body in [[APEC]], which is the forum for facilitating economic growth, cooperation, trade and investment in the Asia-Pacific region, expressed its views in a letter to the IMF on 15 February 2010.<ref name="imf.org">{{cite web|url=http://www.imf.org/external/np/exr/consult/2009/pdf/Comment91.pdf|title=Key to the APEC agenda is reduction of transaction costs|website=imf.org|access-date=2010-03-15|archive-url=https://web.archive.org/web/20100331193737/http://www.imf.org/external/np/exr/consult/2009/pdf/Comment91.pdf|archive-date=2010-03-31|url-status=live}}</ref>

In addition, ABAC expressed further concerns in the letter:

* Key to the APEC agenda is reduction of transaction costs. The proposal is directly counterproductive to this goal.
* It would have a very significant negative impact on real economic recovery, as these additional costs are likely to further reduce financing of business activities at a time when markets remain fragile and prospects for the global economy are still uncertain.
* Industries and consumers as a whole would be unfairly penalized.
* It would further weaken financial markets and reduce the liquidity, particularly in the case of illiquid assets.
* Effective implementation would be virtually impossible, especially as opportunities for cross-border arbitrage arise from decisions of certain jurisdictions not to adopt the tax or to exempt particular activities.
* There is no global consensus why a tax is needed and what the revenue would be used for, and therefore no understanding how much is needed. Any consequential tax would need to be supported by clear consensus for its application.

Note - APEC's 21 Member Economies are Australia, Brunei Darussalam, Canada, Chile, People's Republic of China, Hong Kong, China, Indonesia, Japan, Republic of Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, The Republic of the Philippines, The Russian Federation, Singapore, Chinese Taipei, Thailand, United States of America, Vietnam.

====Views of the ITUC/APLN====
The International Trade Union Confederation/Asia-Pacific Labour Network ([[ITUC]]/APLN), the informal trade union body of the Asia-Pacific, supported the Tobin Tax in their Statement to the 2010 APEC Economic Leaders Meeting. The representatives of APEC's national trade unions centers also met with the Japanese Prime Minister, Naoto Kan, the host Leader of APEC for 2010, and called for the Prime Minister's support on the Tobin Tax.<ref>{{cite web|url=http://www.ituc-csi.org/japanese-prime-minister-backs-call.html|title=Japanese Prime Minister Backs Call for APEC Labour Forum|date=3 September 2010 |publisher=ituc-csi.org|access-date=2011-03-30|archive-url=https://web.archive.org/web/20110929201018/http://www.ituc-csi.org/japanese-prime-minister-backs-call.html|archive-date=2011-09-29|url-status=live}}</ref>

The ITUC shares its support for Tobin Tax with the Trade Union Advisory Council ([[TUAC]]), the official [[OECD]] trade union body, in a research<ref name="tuac.org">{{cite web|url=http://www.tuac.org/fr/public/e-docs/00/00/06/7C/document_doc.phtml|title=The Parameters of a Financial Transaction Tax and the OECD Global Public Good Resource Gap, 2010 – 2020 (en, fr & es) - TUAC - Trade Union Advisory Committee to the OECD|archive-url=https://web.archive.org/web/20110807135130/http://www.tuac.org/fr/public/e-docs/00/00/06/7C/document_doc.phtml|archive-date=2011-08-07|url-status=dead|access-date=2011-03-30}}</ref> on the feasibility, strengths and weaknesses of a potential Tobin Tax. ITUC, APLN and TUAC refer to Tobin Tax as the Financial Transactions Tax.

====Regular investors loss====
An economist speaking out against the common belief that investment banks would bear the burden of a Tobin tax is Simon Johnson, Professor of Economics at the MIT and a former Chief Economist at the IMF, who in a BBC Radio 4 interview discussing banking system reforms presented his views on the Tobin tax.

=====Let Wall Street Pay for the Restoration of Main Street Bill=====
{{Main|Let Wall Street Pay for the Restoration of Main Street Bill}}

In 2009, [[United States House of Representatives|U.S. Representative]] [[Peter DeFazio]] of [[Oregon]] proposed a financial transaction tax in his "[[Let Wall Street Pay for the Restoration of Main Street Bill]]". (This was proposed domestically for the United States only.)<ref name="Charles Pope">{{cite web|url=http://www.oregonlive.com/politics/index.ssf/2009/12/defazio_calls_for_tax_on_high.html|title=DeFazio calls for tax on financial transactions but critics abound|author=Charles Pope|date=December 3, 2009|publisher=[[The Oregonian]], OregonLive.com|access-date=2010-01-04|archive-url=https://web.archive.org/web/20100107032437/http://www.oregonlive.com/politics/index.ssf/2009/12/defazio_calls_for_tax_on_high.html|archive-date=January 7, 2010|url-status=live}}</ref>

====Would there be net job losses if a FTT tax was introduced?====
Schwabish (2005) examined the potential effects of introducing a stock transaction (or "transfer") tax in a single city (New York) on employment not only in the securities industry, but also in the supporting industries. A financial transactions tax would lead to job losses also in non-financial sectors of the economy through the so-called [[multiplier effect]] forwarding in a magnified form any taxes imposed on Wall Street employees through their reduced demand to their suppliers and supporting industries. The author estimated the ratios of financial- to non-financial job losses of between 10:1 to 10:4, that is "a 10 percent decrease in securities industry employment would depress employment in the retail, services, and restaurant sectors by more than 1 percent; in the business services sector by about 4 percent; and in total private jobs by about 1 percent."<ref name="Schwabish">{{Cite journal|last=Schwabish|first=Jonathan A.|year=2005|title=Estimating Employment Spillover Effects In New York City with an Application to The Stock Transfer Tax|journal=Public Finance Review|volume=33|issue=6|pages=663–689|doi=10.1177/1091142105278945|s2cid=154475282}}</ref>

It is also possible to estimate the impact of a reduction in stock market volume caused by taxing stock transactions on the rise in the overall unemployment rate. For every 10 percent decline in stock market volume, elasticities estimated by Schwabish<ref name=Schwabish/> implied that a stock transaction ("transfer") tax could cost New York City between 30,000 and 42,000 private-sector jobs, and if the stock market volume reductions reached levels observed by Umlauf (1993) in Sweden after a stock FTT was introduced there ("By 1990, more than 50% of all Swedish trading had moved to London")<ref name="Umlauf, Steven R. 1993"/> then according to Schwabish (2005), following an introduction of a FTT tax, there would be 150,000-210,000 private-sector jobs losses in the New York alone.

The [[Forward contract|cost of currency hedges]]—and thus "certainty what importers and exporters' money is worth"—has nothing to do with volatility whatsoever, as this cost is exclusively determined by the interest rate differential between two currencies. Nevertheless, as Tobin said, "If ... [currency] is suddenly withdrawn, countries have to drastically increase interest rates for their currency to still be attractive."<ref name="Jubilee-trans"/><ref name="Reiermann"/>