Greetings All; In reading the forums here I have seen that the Tobin / transaction tax of up to 1/4% of the total price of each purchase or sale, has been mentioned recently in the news media as a potential source of revenue for some of the new bills, from Tarp to healthcare, and it seems if enacted it could be problematic for the trading community. Personally I feel a national sales tax to share the sacrifice evenly would be best, but we will see how things progress. My question is: do other countries like Canada, Britain, or in Europe and Asia, with their own stock exchanges, have taxes specifically on trading, and what form do they take? Are they taxes on profits, capital gains, or perhaps a flat fee per transaction similar to brokerage fees now, or more like the transaction tax model being discussed? I am interested in how other governments tax the trading business, and if some of the countries are complicated taxation environments, what strategies would be employed to survive and thrive in such situations?
If anyone has done the research, it would be great to know what other markets/countries charge for transacting? Anyone?
For major exchanges, UK stock market has a prohibitive transaction tax. France used to have one but Sarko removed it.Other than that, Eurex has really low exchange fees. If this tax passes, other exchanges will do anything to attract volume.Perhaps, talks about volume plunge at Eurex and Liffe would be history...LOL. It wouldn't be the end of the world, just the end of the US
the stamp tax in the uk is .5 % on buys and sells of stocks. but over there they get around paying the tax because they use cfds which are contracts for difference. they dont have those instruments in the us but if this tax were to pass the us would have similar instruments. also traders over in the uk are members of the london stock exchange. members of the exchange are exempt from paying stamp duty. same would hold true in the states to some extent big boys such as banks and institutions will be exempt as will members of an exchange nyse, cbot, cboe, phlx, csx etc. the said thing about this tax is that the mom and pop and basically middle america are gonna be targeted and flit the bill. the traders in the know wont ever have to pay this tax. now if congress says to america main street will not have to pay this tax and only professional traders hedge funds and the big banks have to pay i believe that would be the best way to introduce it. but we all know there is no way in hell thats gonna happen.