Senator Tom Harkin (D-IA) and Congressman Peter DeFazio (D-OR) are planning to reintroduce The Wall Street Trading and Speculators Tax, which would apply a three basis point tax to every financial transaction. The announcement comes on the heels of a European Union decision last month to allow 11 European nations to impose a financial transaction tax of 10 basis points for stock or bond transactions and one basis point for derivative transactions.
In January, Senator Harkin commented that “our transaction tax proposal raises considerable revenue with little impact on economically beneficial transactions. It is a tax that does not harm small businesses or the middle class and Wall Street can certainly afford it. I applaud the action taken by the EU today and hope that we will soon have U.S. action on this issue.”
“In the coming months, our country will need to make hard decisions to get back on sound fiscal footing. Our financial transaction tax should be a no-brainer. This tax would target speculators who create tremendous volatility by flipping stocks a thousand times a minute. I, too, applaud the EU. Today's actions mean there will be less opportunity to shift U.S. trading overseas to avoid a U.S. [financial transaction tax]. Wall Street's criticisms of an [financial transaction tax] are rapidly shrinking,” said Congressman DeFazio.
The Congressional Joint Tax Committee scored their proposal as raising $352 billion over 10 years in the last Congress.