Notice that in more precise sources "Tobin taxes" are used in plural (e.g. "Tobin tax ideas" here: http://www.eubusiness.com/news-eu/finance-economy.2u6 ), and some parties are again trying to exploit the confusion between a "bailout insurance premium" - a targeted levy on systemically important bank liabilities and a simplistic tax on financial transactions, including also those "disguised as trade" (Tobin 1978) and also normal transactions of funds where "regular investors like you and me" have to keep their pension money (recall the Malkiel and Sauter WSJ article here: http://online.wsj.com/article/SB10001424052748703558004574579903734883292.html).
It has been tried before (and as recently as in September last year) in the very same way. It is unlikely that any emotionally-motivated policy option is ever adopted, seeing that EU Parliamentary questions on this tax were previously answered by the Commission (in the negative) in an evidence-based manner (see the written answer from 3 September 2009 of Commissioner Kovacs /for Taxation/ to a Parliamentary Committee, cited earlier here: http://www.elitetrader.com/vb/showthread.php?s=&postid=2726020&highlight=European#post2726020 ), with due reference to academic papers (and we have already assured ourselves that there is virtually no evidence supporting any volatility dampening or indeed revenue raising potential of FFT taxes). The FTT tax (as opposed to an Obama-Borg levy) is precisely one of those emotionally-motivated options of the "Tobinesque tax ideas", because out of the two motives cited by its proponents are 1) behavior modification (to "dampen speculation") and only secondarily to 2) pay for the crisis. (see http://www.europarl.europa.eu/news/...IPR69367-23-02-2010-2010-false/default_en.htm ). Little wonder, because the tax has not been designed by Tobin (1978) to raise revenue (it includes a negative feedback loop between the tax base and the tax rate), but in fact the opposite - to chase away any taxable volume from the currency markets and let central banks regain monopoly control over the newly introduced flexible exchange rates.
So the impact assessment the Commission is once again asked to conduct will have the same aim as the job rejected by the IMF (by both Strauss-Kahn and Lipsky), i.e. to assess any volatility-dampening effects of financial transaction taxes ("to see how far it could contribute to stabilising financial markets and prevent a similar crisis by targeting "undesirable" transactions"), which we can probably aid with:
- a link to the "Empirical evidence" section of the Tobin tax Wikipedia article (currently at: http://en.wikipedia.org/wiki/Tobin_tax#Research_evidence_on_transaction_taxes_-_effect_on_volatility , but subject to constant BR-induced volatility
.- a few useful google search keywords: Tobin tax volatility result in site:edu ,
- and for a novelty seeker, that search phrase suggested by Guardian's Tim Worstall - "onion futures" - that's even purer experimental design than the Swedish experience with derivatives, and replicated by the U.S., of all places