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.
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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.’”