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Hillary financial transaction tax1/22/2024 Revenues would be lower if the implementation of the option had to be phased in because of delays in developing the new reporting systems. In addition, JCT's estimate reflects the expectation that financial transactions would be underreported until 2022, when all reporting systems could be expected to be in place. That reduction in the value of financial assets would cause an ongoing reduction in capital gains. The option would lead to a loss in revenues in 2019 because the transaction tax would immediately lower the value of financial assets. The estimate accounts for several effects that would reduce the revenues raised by the transaction tax. The estimate for the option reflects that income and payroll tax offset. The resulting reduction in income and payroll tax receipts would partially offset the revenues generated by the tax. The tax on financial transactions would reduce taxable business and individual income. This option would increase revenues by $777 billion from 2019 through 2028, according to an estimate by the staff of the Joint Committee on Taxation (JCT). That delay would provide the government and firms sufficient time to develop and implement the new reporting systems that would be necessary to collect the tax. The option would be effective a year later than nearly all of the other revenue options in this volume, so the tax would apply to transactions occurring after December 31, 2019. taxpayer (whether a corporation, partnership, citizen, or resident). The tax would be imposed on transactions that occurred within the United States and on transactions that took place outside of the country and involved at least one U.S. The tax would not apply to the initial issuance of stock or debt securities, transactions of debt obligations with fixed maturities of no more than 100 days, or currency transactions (although transactions involving currency derivatives would be taxed). (Such payments are generally just a small fraction of the derivatives' notional value.) Trading costs for high-frequency traders tend to be very low-in many cases less than 0.1 percent of the value of the securities traded-so this option would generate a notable increase in trading costs for them. For purchases of derivatives, the tax would be 0.1 percent of all payments actually made under the terms of the derivative contract, including the price paid when the contract was written, any periodic payments, and any amount to be paid when the contract expires. For purchases of stocks, bonds, and other debt obligations, the tax generally would be 0.1 percent of the value of the security. This option would impose a tax on the purchase of most securities and on transactions involving derivatives. (The Securities and Exchange Commission charges a very small fee-generally 0.0013 percent-on most transactions to recover its regulatory costs in 2018, those transaction fees totaled about $2 billion.) Option Those transactions may affect the taxes of individuals who engage in them, depending on the gain or loss those individuals realize however, there is currently no per-transaction tax imposed under U.S. In addition, trillions of dollars in derivatives (contracts requiring one or more payments that are calculated by reference to the change in an observable variable), measured at their notional value (the total amount of the variable referenced by the derivative), are traded every business day. More than $1 trillion in stocks and bonds-collectively referred to as securities-is traded on a typical business day, including about $300 billion in stock and over $800 billion in debt (which is mostly concentrated in Treasury securities). stocks was roughly $30 trillion, and the value of outstanding bond market debt was about $42 trillion. In June 2018, the total dollar value of U.S. The United States is home to large financial markets with a large amount of daily trading.
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