A tax on securities trades is unlikely to come up for debate in the current Congress, but is by no means a dead issue.
That’s the opinion of Sen. Michael Crapo, R-Idaho, a member of the Senate Banking Committee. Crapo sees no movement on the issue before the November elections. After that, however, given the need to finance the federal deficit, a transaction tax could return to the discussion of how to raise revenues.
“A transaction tax is not off the table,” Crapo told attendees at the annual Security Traders Association in Washington yesterday. “You are advised to keep alert and vigilant.”
For his part, Crapo is opposed to a tax on trades. The Senator is concerned, though, that the Democrats will seek to raise revenues through taxation rather than cutting spending.
“We are going to see a phenomenal effort to try to find the offsets and justify the spending and try to reduce deficits through tax increases rather than spending reductions if this Congress can get away with it,” he said.
Congress has proposed a couple of transaction taxes in the past two years, including HR 4191 by Rep. Peter DeFazio, D-Ore. and Sen. Tom Harkin, D-Iowa. The securities industry opposes any taxes on trades.
