Presidential aspirant Sen. Elizabeth Warren (D-MA) has revealed how she plans to pay for her Medicare for All plan – including a financial transaction tax that could delay the retirement of millions of American workers.
The tax on the financial sector would, according to Warren, raise “about $800 billion”[i]over the next 10 years by what is called a “small tax on financial transactions.” The financial transaction tax would impose a 10-basis point tax on the sale of bonds, stocks or derivatives, but there does not appear to be any exemption for investments in 401(k)s, IRAs or pension plans. Warren contends that the tax would be assessed on and collected from financial firms and would likely have “little to no effect on most investors,” and further suggests that it could help “ease what Americans pay in fees for their investments and reduce the size of relatively unproductive parts of the financial sector.”
However, the American Retirement Association warns that it’s going to come right out of the retirement savings of the middle class. “Contrary to what is being reported, the Warren proposal does, in fact, include a middle-class tax – a middle-class tax on retirement savings,” says Brian Graff, CEO of the American Retirement Association. The ARA points out that: