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Comment by xivzgrev | Hacker News Reader

“Sanders will also release a detailed roadmap -- centered on new taxes on Wall Street -- to raise the $2.2 trillion dollars necessary to pay for this program and his other college funding plans. It will include a 0.5% tax on stock trades (or 50 cents for every $100 worth of stock), a 0.1% fee on bonds, and a 0.005% fee on derivatives. Sanders believes that could raise more than $2.4 trillion dollars over the next ten years.”

Sure hope “stock trades” doesn’t include retirement contributions or rollovers. I just rolled over 90k - that would’ve cost me $900 (sell, then buy).

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It's amazing how politicians like this propose these types of things and never look to see if anyone else has tried it because we have the perfect example, Sweden: "In January 1984, Sweden introduced a 0.5% tax on the purchase or sale of an equity security. Hence, a round trip (purchase and sale) transaction resulted in a 1% tax. The tax applied to all equity security trades in Sweden using local brokerage services as well as to stock options."

As for the results: "revenues from these taxes were disappointing. For example, revenues from the tax on fixed-income securities were initially expected to amount to 1,500 million Swedish kronor per year. They did not amount to more than 80 million Swedish kronor in any year and the average was closer to 50 million. In addition, as taxable trading volumes fell, so did revenues from capital gains taxes, entirely offsetting revenues from the equity transactions tax that had grown to 4,000 million Swedish kronor by 1988" [0].

[0]: https://en.wikipedia.org/wiki/Swedish_financial_transaction_...

You know that the London Stock Exchange currently implements transaction taxes and that it generates billions (€3.8bn per year) yearly in revenue? [1]

How about all these other countries that have implemented or are currently implementing them? [2]

Looks like this clause is why the UK was successful while Sweden may not have been: "The tax is charged whether the transaction takes place in the UK or overseas, and whether either party is resident of the UK or not."

Clearly the UK being a much larger securities market is a much better parallel to the US than Sweden. It all probably comes down to the implementation.

[1] https://en.wikipedia.org/wiki/Financial_transaction_tax#Unit... [2] https://en.wikipedia.org/wiki/Financial_transaction_tax#Unit...

Today we have hyper globalized financial systems and if a country implements taxes like this the big players just move their money elsewhere. This only ends up hurting middle class folks who are playing by the books. I think it would make much more sense to have a very simple tax system (a few percent on every capital gain or income, wether corporate or personal) and get rid of every other complexity and loophole. If America had one of the lowest corporate tax rates many companies would locate headquarters here and bring that few percent of billions of dollar we wouldn't have otherwise.

I also think we could create a special administrative and economic zone (without minimum wage) in the first 50 miles of southern border and allow anyone to come work there from all over the world. This would create a pathway for people to come here legally and have civic and language classes to help integrate. We could pick the best and brightest from this zone for citizenship which I think is a more fair system. Before you dismiss this idea as colonial consider that this area would have the same human rights and laws as the rest of the US just with low wages, this would be better working conditions than most places on earth with similar wages while also providing a defined channel to gain US citizenship.

I like your ideas. However, I don't fully follow the the low corporate taxes one though. Is the idea to compete in a race-to-the-bottom with corporate taxes and profit from trickle-down economics? I think the popular critique of trickle-down is fair.

It's not a race to the bottom, for a number of reasons America is a good place already for international corporations to have headquarters. We have a strong and mostly fair legal system, and rule of law that many countries do not have. We have a world class workforce. But by having high corporate income tax you are driving away companies that would otherwise HQ here and bring money and taxes. I see benefits and no downsides to making the environment here even more appealing to corportations.

Race to the bottom was not a clear expression of what I meant. I meant that US would compete with other tax environments for lowest corporate taxes, which would drive down corporate taxes globally. The obvious implication is that the corporations then contribute even less to the governmental budgets. In terms of foreign policy, this has the problem of breaking solidarity with other countries. Actually, it seems that the whole idea is based on competition instead of cooperation, but given US policies today, that would be normal. What I'm wondering is would this pay off to the winner that would attract many corporations, but derive minimal taxes from them. What's the mechanism to profit from their operating within your administrative unit in that case?

Corporations don't exist in a vacuum, they are organizations of people working and recieving salaries. I would argue that by having corporate headquarters located somewhere you are bringing massive net benefit if you only look at salary. The corporate income tax is just extra that the government can squeeze out of them and its become apparent that the biggest corporations can get out of most of that anyways in the US by careful gaming of the tax code. Thus my proposal to lower the rate to a more realistic amount and simplify the tax code. Amazon paid $0 corporate income tax last year on $11 billion in income, they structure the company around reinvesting all the profit for the exact reason of not paying taxes. 2% flat rate for everyone is much better than 0% for the most cunning.

Corporation tax does not tax (rich) individuals

I'll focus on the initial part of your post to point out that you _cannot_ trivially avoid taxes for operating in the largest economy in the world while operating in the largest economy in the world.

Sure it's possible under certain aspects (like Facebook et al. paying nearly zero under being "mutlinational" and even that relies on the will of the government to allow it) but that does not apply to the US stock market, does it?

Unless someone knows something I don't I can't be convinced financial players would stop trading in the US because of taxes unless they are really, really abusive.

Some evasion to other markets, perhaps, but how much "down" to developing nations are large funds willing to go?

You can't just seamlessly move the entire thing elsewhere. No other country has the economy and international (military) presence. Do we all agree that makes a difference?

I can't see this level of taxation changing things at all

> If America had one of the lowest corporate tax rates many companies would locate headquarters here and bring that few percent of billions of dollar we wouldn't have otherwise.

I think the reality is that while corporations do some jurisdiction shopping, it's pretty clear that low taxes are only one part of the equation of where HQ locations are chosen.

Its sort of amazing that anyone can still openly advocate that raising taxes on the rich "only ends up hurting middle class" or for "no minimum wage" slavery, without getting the shit kicked out of them. The really crazy thing is they think they are good people, not at all rotten and viscous as they truly are. The cliff between rich and poor is ever more increasing, and you think giving the rich more is going to stop this, you deserve whatever is coming to you when the poor have reached their limit and come knocking on your door.

Maybe at least you will realize, that the poor that is going to kick your head in, is not reading Hacker News.

Would you please stop posting ideological and political battle comments to HN? It's not what this site is for.

https://news.ycombinator.com/newsguidelines.html

> Its sort of amazing that anyone can still openly advocate that raising taxes on the rich "only ends up hurting middle class" or for "no minimum wage" slavery, without getting the shit kicked out of them.

Luckily we still live in a civil society where most people understand violence isn't an acceptable response to political disagreement.

I understand you are upset but I ask you to please consider this briefly. If you change conditions to make a specific place more appealing to the rich this does not in any way hurt the poor in that area. If having rich people around was bad for the lower income citizens then people with low income in Monaco would be worse off than people with low income in Africa.

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