Green on the 1/4% Trading Tax

Discussion in 'Trading' started by ProfitTakgFool, Jan 14, 2009.

  1. From the Green article

    "Many U.S. traders are already well versed in trading abroad, and they could accelerate this trend if the transaction tax is passed. This will seriously undermine U.S. stock market values and hinder the fleeting recovery efforts underway now. It’s going to be hard for the IRS to assess a financial-transaction tax on foreign transactions, but don’t put it past them. (Of course,
    Americans pay U.S. income taxes on global profits.)"

    Well, you can be sure I will be looking at IB Canada IF trading foreign futures were not taxed. Imagine how many Canadian brokers would get new business. Maybe THAT would be a good business to get into.

    However, I have a feeling the US will also apply this 1/4% tax to US citizens, even if trading FOREIGN indexes at a foreign broker. The

    But I would have no complaint trading the Toronto stock index...
     
    #21     Jan 18, 2009
  2. Well, I don't have dual citizenship so I wouldn't be able to do that directly. But, I suppose I could trade futures from an offshore account. Only problem would be transferring the profits back home without getting in trouble with IRS.
     
    #22     Jan 18, 2009
  3. Div_Arb

    Div_Arb

    Screw this trader tax BS.. What we need is a 1% national consumption tax. A 1% national sales tax will not be too huge to kill any future gain in consumption, either. Imagine what will happen to the markets if this trader tax is passed.. Hello Dow 500!! Forget about taxing capital formation, tax consumption! Let's bring the illegal immigrants and black markets into the tax fold by introducing a 1% consumption tax.
     
    #23     Jan 18, 2009

  4. I don't think you have anything to worry about - I don't think Wall Street would allow it, they've known since the beginning of the exchange that the system doesn't work without short-term speculators...all they have to do is go back in history and see what happened when they did try it.

    True - the public are idiots - they think short sellers are theives and the actual reason for the banks going out of business. Plus idiot buy & hope baby boomers need someone to blame for their losses - so they blame it on speculators....

    When we get a fake rally, this will all probably get swept under the rug.
     
    #24     Jan 18, 2009
  5. Don't worry about it guys, worse comes to worse, I can help set you guys up in Toronto, you don't need to end your trading over something so simple.

    The Canadian exchange wouldn't follow the americans. In fact, the financial people in the Canadian government will see it as an opportunity for alot more business. As it stands, our banks have been rated the highest in the world so your funds are safe here.
     
    #25     Jan 18, 2009
  6. We already have a 5% national consumption, plus another % depending what province you live in. No need for this trading tax here :D
     
    #26     Jan 18, 2009
  7. I wonder how much of GDP really is tied to trading. It's more than just the traders, you've got magazines, newspapers, bloggers, trading advisors, etc. I'm thinking there might actually be close to 1 job that doesn't involve trading for every profitable trader. Some of those would probably go away, not all, though.
     
    #27     Jan 18, 2009

  8. US brokers generated One Half Trillion dollars in revenue for 2007, two thirds of the global securities industry.

    http://www.sifma.org/research/pdf/RRVol3-5.pdf


    From a different source that I lost:

    Derivatives only: US Brokerages generated $33 Billion in revenue just from derivatives trading alone in 2006, surpassing the US pizza industry by $3 Billion.

    The entire global securities industry generated $713 Billion in 2006.

    All these other countries cannot wait to get at US market share. Pass the tax, pass the tax they say:


    http://www.yomiuri.co.jp/dy/business/20090118TDY08001.htm

    Jan. 18, 2009

    ...letter to U.S Treasury Secretary-designate Timothy Geithner from Isao Kubota, president of Fukuoka-based Nishi-Nippon City Bank....


    The Tobin Tax is mentioned, welfare economics, the market is never right, sounds like daily price setting for stocks and commodities, strict qualifications for market participants, etc.
     
    #28     Jan 18, 2009
  9. just21

    just21

    The French government have been lobbying for a transaction tax for years on FX.
     
    #29     Jan 18, 2009
  10. It seems everyone is worrying about nothing right now. This was an op ed piece only, its not being talked about in the financial community at all if you try and search for it. And if you read the Tobin Tax has been shot down numerous times espcially by our government. I know our government is stupid right now, but they would not take away substanial revenue from the banks they just bailed out since the gov is some of their biggest share holders now. Speculators count for a majority of the revenue for lots of the big firms. So this is just ET bringing this up over a little article of someone trying to get there 15 mins of fame. Nowhere on real financial websites is this being mentiones as a worry.
     
    #30     Jan 18, 2009