12 Nov 2010

FTTs in the US

I've been a bit quiet for a few days - giving three talks in two days in San Diego, going to see the Beatles Love show in Las Vegas and flying back to Toulouse.  But my discussions with colleagues in the US have been very interesting and I've been getting some really good feedback. At the afternoon tea in Terry Sejnowksi's lab at the Salk Institute (an institution created many years ago by Francis Crick), I talked about my suggestion of imposing a 1% Flat Rate Financial Transaction Tax to replace the existing taxes on income, profits and sales.

Terry just emailed me with some links toward some propositions that have already been made in the US. First, there was H.R. 4191 ("Let Wall Street Pay for the Restoration of Main Street Act of 2009") proposed by Peter De Fazio on December 3rd 2009. That bill was calling for a 0.25% FTT that would apply to t certain securities transactions, including transactions in stocks, futures, swaps, credit default swaps, and options.

Then, even more recently, there was H.R. 4646 "Debt Free America Act", a proposal from Chata Fattah with the purposes of  raising of sufficient revenue from a fee on transactions to eliminate the national debt within seven years and the phasing out of the individual income tax. Amends the Internal Revenue Code to impose a 1% fee, offset by a corresponding nonrefundable income tax credit, on transactions that use a payment instrument, including any check, cash, credit card, transfer of stock, bonds, or other financial instrument. Defines "transaction" to include retail and wholesale sales, purchases of intermediate goods, and financial and intangible transactions.

Clearly, Nancy Pelosi (the house speaker) is a supporter as can be seen from this report.

Brilliant. Let's do it (and not just in the US)!

In a sense, I'm relieved. OK, I'm not the first person on the planet to have proposed the idea that a 1% FTT could replace income tax. On the other hand, I'm not alone!

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