1/4% Tax on all stock trades pushed in NY Times today

Quote from justrading:

You could also look at it differently.

If the FTT is adopted globally, there are certain implications, eg reduction in transaction volumes, reduced profitability and reduced taxes collected, etc etc.

If the FTT is only adopted by certain countries, you can add to that list migration of financial activity to other countries where it would be cheaper.

To paraphrase Osborne, adopting the FTT globally would be bad, adopting it only in certain countries would be ruinous.
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The negative implications for society would be more profound than "reductions in transaction volumes, reduced profitability and reduced taxes collected."
 
Quote from HedgeItYourself:

The negative implications for society would be more profound than "reductions in transaction volumes, reduced profitability and reduced taxes collected."
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I would not disagree, I was merely providing a few examples, not attempting to provide a comprehensive listing.
 
"Swedish Finance Minister Anders Borg pointed out that a financial transactions tax in his country saw implementation costs out-run revenues."

http://msn.finance.com.my/index.php/rss/5504278

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Quite a tax if the implementation and collection costs alone are more than what the FTT generates in revenues. Not surprising since Sweden only collected 3 percent of the projected FTT revenues alone... And that's not subtracting GDP loss, job loss, and other tax revenue losses the FTT creates.

I don't remember hearing of this before. Nothing from Borg and implementation costs shows up before November 8. Would be good to have more quotes and sources about Sweden's experience. It would be nice to be in the 1 percent and hire a secretary to do research.
 
Quote from FightTheFuture:

"Swedish Finance Minister Anders Borg pointed out that a financial transactions tax in his country saw implementation costs out-run revenues."
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I've always felt that this is one important subject that is always overlooked in FTT discussions.

The bureaucracy required to manage such a tax would be huge and very expensive. Thousands more federal employees with benefits and retirement packages.
 
Tortoise,

Re earlier discussion on quantifying impact of FTT on transaction costs, see page 10.

FINANCIAL TRANSACTION TAXES:BENEFITS AND COSTS

http://www.rmcsinc.com/articles/FTTCLC.pdf

Selected quotes;

....purchase the Vanguard Total Stock Market Exchange-Traded Fund (“ETF”). The FTT of 0.25% would be more than six times the bid-ask spread of 0.04% ($0.02).

.....proposed tax of .02% (i.e., 2 basis points) on derivatives transactions sounds very small, the tax will actually be quite large vis-à-vis other trading costs. A recent circular from CME Group, for example, compared the size of the FTT proposed by Rep. DeFazio to other costs of trading CME’s Eurodollar futures contract, which is the most widely traded futures contract in the United States. The per-share cost of transacting would increase from 0.04% of market value to 0.29%, or from $0.02 to $0.145. On a 100-share transaction, the transaction cost faced by an investor would increase from $2 to $14.50.

The 2 basis point tax in the DeFazio proposal would result in a tax bill of $400 on a “round trip” transaction for a single Eurodollar futures contract (which has a notional value of $1 million). For comparison purposes, a market maker trading Eurodollars pays the exchange roughly $0.11 per contract ($0.22 on a round trip transaction) and would face costs of roughly $12.50 to cover the typical bid-ask spread.
The enormous increase in trading costs resulting from the proposed FTT would provide a strong incentive for market participants to find other venues for trading Eurodollars or to cease trading them altogether. Eurodollars are not listed exclusively on the CME – they are also currently listed at Euronext.LIFFE in Europe.
 
A major part of the motivation for this tax is empire building by Barroso and Semeta. London will be sucked dry and the money will go straight to thousands of EU bureaucrats in Brussels. Merkel will dance in the streets as the UK crashes and Germany is established as the dominant economic force in Europe.

Quote from lindq:

I've always felt that this is one important subject that is always overlooked in FTT discussions.

The bureaucracy required to manage such a tax would be huge and very expensive. Thousands more federal employees with benefits and retirement packages.
More...
 
Quote from justrading:

Tortoise,

Re earlier discussion on quantifying impact of FTT on transaction costs, see page 10.

FINANCIAL TRANSACTION TAXES:BENEFITS AND COSTS

http://www.rmcsinc.com/articles/FTTCLC.pdf

Selected quotes;

....purchase the Vanguard Total Stock Market Exchange-Traded Fund (“ETF”). The FTT of 0.25% would be more than six times the bid-ask spread of 0.04% ($0.02).

.....proposed tax of .02% (i.e., 2 basis points) on derivatives transactions sounds very small, the tax will actually be quite large vis-à-vis other trading costs. A recent circular from CME Group, for example, compared the size of the FTT proposed by Rep. DeFazio to other costs of trading CME’s Eurodollar futures contract, which is the most widely traded futures contract in the United States. The per-share cost of transacting would increase from 0.04% of market value to 0.29%, or from $0.02 to $0.145. On a 100-share transaction, the transaction cost faced by an investor would increase from $2 to $14.50.

The 2 basis point tax in the DeFazio proposal would result in a tax bill of $400 on a “round trip” transaction for a single Eurodollar futures contract (which has a notional value of $1 million). For comparison purposes, a market maker trading Eurodollars pays the exchange roughly $0.11 per contract ($0.22 on a round trip transaction) and would face costs of roughly $12.50 to cover the typical bid-ask spread.
The enormous increase in trading costs resulting from the proposed FTT would provide a strong incentive for market participants to find other venues for trading Eurodollars or to cease trading them altogether. Eurodollars are not listed exclusively on the CME – they are also currently listed at Euronext.LIFFE in Europe.
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very helpful. thanks. will incorporate this and the other stuff when i begin the big push this weekend through thanksgiving week
 
Quote from tomdavis:

A major part of the motivation for this tax is empire building by Barroso and Semeta. London will be sucked dry and the money will go straight to thousands of EU bureaucrats in Brussels. Merkel will dance in the streets as the UK crashes and Germany is established as the dominant economic force in Europe.
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spot on.
 
http://m.spiegel.de/international/europe/a-798399.html

Greetings from the Vegas Traders Expo. Big showdown Friday with Cameron visiting Merkel. She better drop FTT or be ready for the UK to drop out - of her plans to ram through EU treaty changes counting on UK approval. The EU is hanging by a thread now and the UK is more important than a stupid FTT which will make the financial crisis even worse.

Let's hope we can kiss FTT goodbye tomorrow. Cameron's got this one, don't cave.
 
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