What You Need to Know
- FTTs “would ultimately be paid by out-of-state investors,” two GOP lawmakers say.
- The bill blocks states from imposing financial transaction taxes on stock exchanges and BDs.
- SIFMA, the BD advocacy group, and Americans for Tax Reform, an anti-tax group, support the bill.
Top GOP lawmakers on the House Financial Services Committee introduced legislation Tuesday to block states from imposing financial transaction taxes (FTTs) on stock exchanges and broker-dealers.
The bill, The Protecting Retirement Savers and Everyday Investors Act, was introduced by ranking member Patrick McHenry, R-N.C., and Rep. Bill Huizenga, R-Mich.
Both lawmakers said FTTs “would ultimately be paid by out-of-state investors when the FTT is passed onto them.”
New York and New Jersey are states considering financial transaction taxes. New Jersey’s A4402 would impose a 0.25 cent tax on every financial transaction processed in the state, according to the Tax Foundation. “In New York, some lawmakers have proposed a rate as high as 5 cents per share (1.25 cents for stocks worth less than $5),” the Tax Foundation said.
Americans for Tax Reform along with 30 other groups called on members of Congress in a letter, dated March 9, to reject any proposal to implement a financial transaction tax.