Recent bills introduced in Congress to impose a financial transaction tax (FTT) would have a drastic effect on retirement savings and many other aspects of the U.S. economy, argues a new white paper.
Drafted by James Angel, Ph.D., Associate Professor of Finance at Georgetown University on behalf of the U.S. Chamber of Commerce’s Center for Capital Markets Competitiveness (CCMC), the paper contends that instead of the burden falling on Wall Street, the real impact of an FTT will be on ordinary investors, such as retirees, pension holders and those saving for college.
“They will pay the tax directly when they trade and pay it again as financial intermediaries pass on the taxes they face as a cost of doing business. FTTs are not actually a tax on financial intermediaries; they are a tax on investors,” Angel writes in the paper, “Financial Transaction Taxes: A tax on investors, taxpayers, and consumers.”
The 40-page paper also explores the potential impact an FTT would have on capital markets such as the securities that support the housing market, operations of businesses and infrastructure financing. It was released Sept. 16 at a briefing on the Senate side of Capitol Hill.