posted 09-04-2002 01:07 AM               

The sources said Chirac rejected the existing "Tobin Tax" proposal to raise levies purely on foreign exchange
transactions but would call in a speech to the summit for discussion on a wider tax on wealth generated by globalisation.

"It could be a tax on airplane tickets, on carbon dioxide, on health products sold in industrialised countries, and indeed on international financial transactions," one source said.

"The idea of wanting to hold back a small share (of global wealth) to relieve poverty is not a mad idea at all. But the debate has been polluted by the campaign on the Tobin Tax," the same source added.

The Tobin Tax, championed by non-governmental groups as a way both to raise funds and to deter financial speculation, attracted much interest particularly in Europe last year but since appears to have fallen out of favour.

European officials have noted possible problems with the tax, proposed by U.S. Nobel Prize winner James Tobin in the 1970s.

One is that financial markets would simply move to those countries that chose not to apply the tax.

World leaders began arriving at the World Summit on Sustainable Development on Monday hoping to settle differences over an action plan to end what South African President Thabo Mbeki called "global apartheid" between rich and poor.

The sources close to Chirac, who was due to speak in Johannesburg around midday local time (11 a.m. British time) on Monday, pointed to studies suggesting global development aid would have to be doubled to around $100 billion (64 billion pounds) to really fight poverty.