Leaders of the nation’s public employee union urged legislators Wednesday to adopt a so-called Robin Hood tax.
Specifically the Asociación Nacional de Empleados Públicos y Privados lobbied for a tax on international financial transactions. The organization said that such a tax could raise $400 billion a year if assessed worldwide.
The association said that the proceeds in Costa Rica could be used for social programs and force the banking and financial sector to return some of what it has systematically and abusively extracted from society.
Robin Hood, of course, was the legendary Saxon who robbed from the rich and gave to the poor.
The association was joined by the little-known Central Social Juanito Mora Porras in presenting the proposal to Juan Carlos Mendoza García, president of the Asamblea Legislativa. Although this idea may never get off the ground, the proposal shows that the field is wide open for all sorts of tax ideas as part of fiscal reform that is being pushed by the Chinchilla administration.
The nation’s finance minister presented a revised plan on behalf of the government Tuesday. The proposals also are Robin Hoodesque in that the central government makes no apologies for plans that levy disproportionate tax burden on financially successful individuals and corporations.
The general idea of a financial transaction tax was been discussed for years. There have been plans floated in Costa Rica to assess a tax on every bank transaction. The Asociación Nacional de Empleados Públicos y Privados outlined a proposal that only would apply to international transactions. If passed, income from export sales like bananas and pineapples would be subject to the tax as well as pensions from overseas.
The association attributed the idea to Nobel Prize winning economist James Tobin, although that academic had second thoughts later in life. Tobin had proposed a general financial transaction tax of the type that some European politicians have been proposing.
Sweden had mixed results from such a tax. Even in the United States some congressmen have proposed a tax on stock transactions. The bill is formally titled H.R. 4191: Let Wall Street Pay for the Restoration of Main Street Act of 2009.
The association said it made the presentation as part of an international day of global action that is being observed around the world.
The Chinchilla administration plan would collect $1 billion more a year in taxes, mostly from the 20 percent of the population that is engaged in commerce and investments.
That amount represents about 2.5 percent of the gross domestic product of the country. The central government is running an annual deficit of more than twice that at 5.5 percent or about $2.2 billion.
The revised tax reform package was sent to committee where the financial transaction tax might be discussed.