Rep. Peter DeFazio, D-Ore., is doing it again—partnering with Sen. Tom Harkin, D-Iowa, to present a bill to tax trades of stocks, bonds and derivatives. The two previously tried in 2009 to propose such a measure, but it failed. However, although businesses are already preparing to oppose any such tax, the political climate may have changed enough for it to squeak by.
Politico reported that a similar proposal to tax trades has gathered support in Europe, with France and Germany its big supporters. With the congressional supercommittee in need of ways to slice at least $1.2 trillion from the national debt in the next ten years, this time the bill could be a starter.
Tom Quaadman, executive director for financial reporting policy and investor opportunity at the U.S. Chamber of Commerce, said in the report, “In reality, a proposal like this is going to be on the table in some regard.”
DeFazio’s previous attempt to push through such a measure was estimated to bring in a potential $150 billion a year in revenue. It had the added advantages of sparing social programs like Social Security, Medicare and Medicaid from cuts.
Although the Obama administration has said previously that it did not support such a tax, the fact that Europe is embracing the notion may change that stance, as Damon Silvers, policy director at the AFL-CIO, pointed out in the report: “What’s happened in the last week is that a financial transaction tax has become politically plausible because of Europe. The question is not ‘if,’ but ‘when.’”