Congressional Democrats have introduced legislation to create a new tax on financial transactions that they say, “would generate billions in revenue, while addressing economic inequality and reducing high risk and volatility in the market.”
The Wall Street Tax Act would tax the sale of stocks, bonds, and derivatives at 0.1 percent (10 basis points) and would raise an estimated $777 billion over a decade. A stock trade of $1,000 would incur a tax of $1. The tax would apply to the fair market value of equities and bonds, and the payment flows under derivatives contracts. Initial public offerings and short-term debt (with a maturity of less than 100 days) would be exempted.
