That will impact general market dynamics, thus altering the entire trading environment.
We have seen this kind of taxation in Europe already many years ago. Till today it has not spread all over Europe. Some of these taxations were even abolished after a short time because economical detremental. Taxation resulted in LESS income instead of more income for the government. And parts of the markets shifted to other countries.
Some of these experiments:
In Belgium existed an exchange fee and since 2016 a speculation tax. Since the introduction of the speculation tax, paid stock exchange taxes fell by 55%. The two taxes together fell 29% short of the stock exchange tax only in the last year.
So raising taxes or introducing new taxes diminished the total amount of taxes collected. Like predicted (Laffer curb).
Anders Borg, Sweden's finance minister, has told that a European financial transaction tax won't work, citing his countries own experiment with the tax.
When Sweden began taxing financial transactions in the 1980s, "between 90%-99% of traders in bonds, equities and derivatives moved out of Stockholm to London," Borg said.
"The impact was basically that we did not get any tax revenue. It brought in very little tax money while moving most of the businesses outside of Sweden.
"We abandoned [the tax] because it was a very, very bad functioning tax."
Sweden implemented its tax in 1984. It was a 0.5% tax on a purchase or sale of an equity security. It was doubled in 1986 and subsequently lowered. In 1991 the tax was abolished following disappointing revenues.
