Dec. 8, 2015

Progress Made in Europe Toward a Collaborative Financial Transaction Tax Highlights Need for U.S. to Act

Statement of Susan Harley, Deputy Director, Public Citizen’s Congress Watch Division

Note: After several years of deliberations, 10 European nations today announced a framework for collaboratively taxing financial transactions. The countries that announced an initial agreement between their nations are Germany, France, Italy, Austria, Belgium, Greece, Portugal, Slovakia, Slovenia and Spain while Estonia, formerly part of the talks, did not join today’s announcement.

This morning’s news from Europe was very encouraging and we are pleased to see an agreement from the 10 nations to begin implementing a collaborative financial transaction tax. Though important details such as the tax rate won’t be finalized for another six months, today’s announcement was a major step forward toward seeing a unified tax enacted.

The announcement should be a rousing call for Congress to take action and reinstate a similar tax here in America. The U.S. had a financial transaction tax in place from 1914 until the end of 1965, and still has a tiny fee on stock trades that helps fund the U.S. Securities and Exchange Commission.

According to a recent report from Public Citizen, “Financial Transaction Tax: An Old Solution to a New Problem,” using historical data and the tax rate at the time of the repeal of the tax, Americans have lost out on an estimated $400 billion in revenue over the past half century. With that sort of potential revenue on the table, and the nation watching as Congress battles over spending bills, it’s ridiculous that our nation has not yet reinstated the tax.

It’s far past time for the U.S. to join the rest of the world and reinstate a financial transaction tax.

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