The case for a trading tax.
#1
Posted 18 January 2009 - 07:40 PM
I am an advocate of a trading tax even back when George Bush Sr. sent out a trial balloon for one which, of course, was quickly shot down. (If I recall correctly the trial balloon lasted one day and was never heard from again ) Most on this board are opposed to ANY tax on trading which I fully understand, however, the tax would fall only on the user. Not unlike a gasoline tax, toll tax, telephone tax, etc. The tax need not be .0025% on the total transaction. Actually a flat fee user tax of say $20 per transaction would be acceptable to many I believe. With trillions of debt it is well understood taxes will be raised for the many. IMO this is one of the least egregious ways to raise revenue.
Good trading to all.
johngeorge
#2
Posted 18 January 2009 - 07:48 PM
klh
#3
Posted 18 January 2009 - 07:56 PM
#4
Posted 18 January 2009 - 07:59 PM
~Benjamin Franklin~
#5
Posted 18 January 2009 - 08:07 PM
Edited by Data, 18 January 2009 - 08:08 PM.
#6
Posted 18 January 2009 - 09:20 PM
Tax the rich at a very high rate and government will shrink in size. Then the tax burden on everyone will fall.
I doubt that a transaction tax will accomplish that. Chances are a transaction tax would be as heavy a burden on small investors as on the huge institutions that have a hand in formulating public policy.
James
http://www.portfolio...n-Stock-Trading
I am an advocate of a trading tax even back when George Bush Sr. sent out a trial balloon for one which, of course, was quickly shot down. (If I recall correctly the trial balloon lasted one day and was never heard from again ) Most on this board are opposed to ANY tax on trading which I fully understand, however, the tax would fall only on the user. Not unlike a gasoline tax, toll tax, telephone tax, etc. The tax need not be .0025% on the total transaction. Actually a flat fee user tax of say $20 per transaction would be acceptable to many I believe. With trillions of debt it is well understood taxes will be raised for the many. IMO this is one of the least egregious ways to raise revenue.
Good trading to all.
#7
Posted 18 January 2009 - 09:21 PM
this is one of the least egregious ways to raise revenue
So, less information available to market participants is a good thing? Less liquidity and larger bid/ask spreads are a good thing? Less ability to allocate capital efficiently is a good thing?
Any "trading tax" is one of the MOST egregious ways to raise revenue.
The reason is very simple. The ONLY way that standards of living increase is through increases in productivity. The ONLY way that productivity increases is through capital investment. Obviously, anything that discourages capital investment will be to the detriment of productivity and standards of living in general.
Very, very bad idea. You wanna tax something, try consumption.
#8
Posted 18 January 2009 - 09:24 PM
Tax the rich at a very high rate and government will shrink in size. Then the tax burden on everyone will fall.
What are you smoking? I want some.
#9
Posted 18 January 2009 - 09:46 PM
The only statistic on program trading I could find on short notice is the one listed here: Appears to me that program trading was about 30% of all trades on the NYSE in 2007. Hardly productive. Raises no new capital; rather it lines pockets of large banks, brokers, and provides obscene bonuses to their management.
Regards impairing capital...................hmmmm I hardly think $20 will impair or opaque much of anything. Just my take.
this is one of the least egregious ways to raise revenue
So, less information available to market participants is a good thing? Less liquidity and larger bid/ask spreads are a good thing? Less ability to allocate capital efficiently is a good thing?
Any "trading tax" is one of the MOST egregious ways to raise revenue.
The reason is very simple. The ONLY way that standards of living increase is through increases in productivity. The ONLY way that productivity increases is through capital investment. Obviously, anything that discourages capital investment will be to the detriment of productivity and standards of living in general.
Very, very bad idea. You wanna tax something, try consumption.
johngeorge
#10
Posted 18 January 2009 - 09:50 PM
Tax the rich at a very high rate and government will shrink in size. Then the tax burden on everyone will fall.
What are you smoking? I want some.
The trick is not to smoke anything, then what is obvious starts to make sense.