Do you support a Robin Hood tax and do you support a tax on financial transactions are two very different questions. Unfortunately, in the eyes of many, including top regulators, they are as one.

The problem with calling the financial transaction tax a Robin Hood tax is that it taps into the widespread anger surrounding the riches the financial services industry has enjoyed at a time when the real economy faces cuts and shortfalls.

Few would argue against the merits of a Robin Hood tax. I am not a raving liberal and certainly will not take my tent and camp outside St Pauls anytime soon, but it is clear that the continued growth of inequality in the US and Europe is an unsustainable path that must be checked to prevent instability in society.

In principle the FTT sounds great. Indeed a consortium of 350 economists recently lent their support to such a tax “calling on G20 governments to back a financial transactions tax on speculative dealings in foreign currencies, shares and other securities of 0.05% – say £500 on a £1m transaction” a recent report in UK’s Independent said.

Such a tax, claim supporters, would raise billions. They are being overly pessimistic. A 0.05% transaction tax on over the counter derivatives in foreign exchange and interest rates alone would theoretically raise $300bn.

Quite clearly this is hopelessly unrealistic. You cannot charge 0.05% on a business that only makes a fraction of that in profit on a trade. In its current form the FTT will quickly kill the host on which it feeds.

And this is the point. While a Robin Hood tax is a much needed initiative, employing it in the form of a transaction tax ignores a simple but fundamental flaw in its aim to tax the notional value rather than the profits of a trade.

The FTT is no Robin Hood tax. Rather than alluding to the hero of British folklore why not give the tax a more realistic moniker and name it after another British figure: the Maxwell tax, in honour of the late Robert Maxwell and the impact he had on his company’s pension scheme.

The FTT would surely wreak similar havoc on pension schemes across Europe and the US as they would face immensely higher costs and wider spreads.

Bring on a Robin Hood tax but don’t waste time confusing the FTT for such a tax.