why isn't there a transaction tax? - Democratic Underground

Skink

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Mon Aug-03-09 11:19 AM
Original message

why isn't there a transaction tax?

Scott trade is advertising 7 dollar trades do they not pay a tax on that?

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cbdo2007

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Mon Aug-03-09 11:23 AM
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1. Does who pay tax on that? I'm sure Scottrade pays taxes.

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Xithras

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Mon Aug-03-09 11:47 AM
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2. Because we levy taxes on the results of the trade.

It would be like you going into a store to buy a TV, and paying a 20 cent "transaction tax" on the sale in addition to paying the 8% "sales tax" that's already levied.

Though there are those who do advocate eliminating capital gains taxes on stock sales in favor of a transaction tax instead. A transaction tax would raise more money, and unlike capital gains taxes, would also be paid by those who lose money in stock sales.

I don't know of anyone advocating the implementation of both types of taxes at the same time though. That would permanently kill the market for small investors.

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