Democratic presidential candidate Bernie Sanders introduced legislation that would impose a tax on trades of all stocks, bonds and derivatives in the U.S., a move he says would help curb Wall Street speculation and help finance his campaign promise to provide tuition-free college and cut student debt.
Sanders has been promoting a financial transactions tax since his run for the Democratic nomination in 2016. The plan he offered Wednesday would apply a 0.5% tax rate for stock trades, a 0.1% rate for bond trades, and 0.005% for derivatives transactions.
The tax would both provide a disincentive for high-frequency trading based on algorithms and let Wall Street help middle-income Americans who helped foot the bill for the bailout of financial institutions after the 2008 market crash, he said at a news conference with other Democratic co-sponsors.
“While millions of American suffered from the Great Recession, Wall Street received the largest taxpayer bailout in the history of the world, with no strings attached,” Sanders said. He added that leading financial institutions have recovered and are doing “phenomenally well.”
As he did in 2016, Sanders said the tax could generate enough revenue to offset the costs of tuition-free college and help pare down student debt. He said Wednesday that the proposal could generate as much as $2.4 trillion over a decade.
The bill’s lead Democratic House sponsor, Representative Barbara Lee of California, said the “massive revenue” could ensure that “Wall Street pays their fair share.”