Congressman Tom Price Drops Bill To Oppose Financial Transaction Tax

December 4, 2012 10:39 am

by Nathan · 3 comments

Congressman Tom Price issued a presser this past Friday when he introduced legislation to oppose a financial transaction tax that’s being talked about in the European Union.  The apparent rationale behind the tax is to tax currency bond and shares traded at banks and financial institutions in EU member nations who adopt the measure, according to the BBC.  Congressman Price’s bill would prohibit “the Secretary of the Treasury from assisting any foreign government with respect to the collection of a tax on securities transactions occurring on a United States financial exchange.”

From Congressman Price’s presser:

“Paying taxes to other countries is a bad idea – and we need a law to stop it! This financial transaction tax would harm small businesses and investors while damaging American entrepreneurs’ ability to compete in a competitive global environment,” said Congressman Price. “France and other European Union nations want to charge more taxes on financial transactions, ignoring the fact that small investors will be forced out of capital markets.  This move would impede financial markets efficiency, decrease liquidity, distort and discriminate within markets, and raise costs all at a time when what our economy desperately needs is more private capital investment in growth and job creation. I urge my colleagues to act on behalf of American entrepreneurs, investors and job creators by joining this effort to preempt the imposition of any form of a financial transaction tax on American markets.”

Talk of the “fiscal cliff” and increases on federal taxes have dominated the post-election media market.  This little tidbit has seemingly been absent from the news that I’ve seen, but it could potentially have impact on the United States.  Although, for all we know, President Obama could try to get the Securities and Exchange Commission to levy a “fee” on all  securities transactions.  Besides, only rich people own stock and need to pay their “fair share”, right?  Remember, you never want a serious crisis to go to waste.

xdog December 4, 2012 at 10:50 am

Apparently there’s already relevant law on the books.

“the US income tax treaty with France was designed to prevent extraterritorial application of stock transaction taxes.”

Or so says this link: http://www.tax-news.com/news/Price_Bill_Would_Stop_EU_FTT_Enforcement_In_US____58616.html

John Konop December 4, 2012 at 11:14 am

Would this tax not be an advantage to our country and create more capital investment here?

From your Link BBC:

……….. Governments across Europe have been implementing drastic austerity measures to cut debt levels, and taxing banks is seen by some as an important way to raise revenues, particularly while the economic recovery remains so fragile.

Opponents argue that unless it is adopted universally, the tax would drive business to financial centres that did not impose the tax.

A spokesman for the Treasury was critical of the plan by the 10 countries.

“We’ve consistently said the UK will not participate in an EU FTT,” he said.

“As with an EU-wide FTT, a FTT amongst a smaller number of EU countries would still have damaging impacts on growth, jobs and financial activity in the EU.

“It would increase costs for pensions, for manufacturers. It could conceivably distort competition and fragment the single market.

“We are, however, not minded to block others from creating a FTT using the enhanced co-operation procedure, but before taking a firm view the UK would need to fully consider the scope of the new proposal and what the revenues would be used for.”………..

Chris Huttman December 4, 2012 at 11:38 am

Most talk of taxes on individual trades are somewhere in the fraction of a cent rate. Meaning, you’d pay an extra penny every time you execute a trade. I think I’m probably somewhat on the heavy side – made about 40 trades this year. That’s less than a dollar.

Even most rich people aren’t making tons of trades, so essentially if they did a tax like that (not saying that’s necessarily my preferred solution) it would only hit people who are making thousands of trades a day, not the little guy or the rich guy.

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