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Bill Gates Advocates Tax On Financial Transactions

timothy posted more than 2 years ago | from the and-you-thought-you-hated-atm-fees dept.

Government 694

First time accepted submitter wanzeo writes "With the current G-20 summit dominated by global financial uncertainty, previously unsuccessful tax strategies are getting new attention. In a short interview with the BBC, Bill Gates explains his support for a potential tax on financial transactions. The concept is sometimes called the Tobin tax after its originator, Nobel Laureate economist James Tobin, who first put forth the idea in 1972. Gates points to the success of Britain's Security Settlement Tax, and suggests that large economies like Germany, France, and the U.S. have expressed interest in his plan."

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And now lets word it to screw the little guy. (-1, Troll)

jellomizer (103300) | more than 2 years ago | (#37984192)

Lets make exceptions on stock trades, and values over a particular amount. So we end up adding an extra tax when the average Joe uses his credit card or pays a check.

Re:And now lets word it to screw the little guy. (0)

Anonymous Coward | more than 2 years ago | (#37984226)

RTFA. You're comment makes absolutely no sense, and only serves to prove you're a moron who will not hesitate to open his fat mouth regardless of how clueless he is on the topic at hand.

Re:And now lets word it to screw the little guy. (3, Insightful)

Spiked_Three (626260) | more than 2 years ago | (#37984296)

The article says very little. At best he could watch TFA. and even then, nothing in it goes against what he said, that the US rich would turn it into a screw the middle class and poor objective. So I think its fair to say AC, you are the moron here. In your best case, an idiot at presenting an opposing argument.

Re:And now lets word it to screw the little guy. (1)

justin12345 (846440) | more than 2 years ago | (#37984530)

There isn't much real information in the "article". There is a 2 minute video of Bill Gates discussing in very broad terms his support of a transaction tax, and his opinion that it will never happen in the US. There is a link to wikipedia describing a Tobin tax, which is a tax on currency exchange transactions. But Gate's doesn't seem to be discussing a tax on currency transactions. Then there is a link to an image of 2007 British tax code, which doesn't exactly explain what Bill is in favor of enacting either.

I sympathize with the parent's outlook. How can we trust US government officials to not slant the playing field toward the wealthy (their "base", as Bush famously called them)?

Re:And now lets word it to screw the little guy. (1)

pla (258480) | more than 2 years ago | (#37984608)

RTFA

Nice try, but the FP summary includes far MORE detail than TFA - Proving, amusingly enough, that you haven't R'd TFA.

Re:And now lets word it to screw the little guy. (0)

Joce640k (829181) | more than 2 years ago | (#37984622)

you're a moron who will not hesitate to open his fat mouth regardless of how clueless he is on the topic at hand.

He got first post though...!

Re:And now lets word it to screw the little guy. (-1)

Anonymous Coward | more than 2 years ago | (#37984360)

Fuck Bill Gates. I'll bet if this had anything to do with buying licenses for Windows or Office, he wouldn't be "advocating" it. Sorry robber baron mother fucker. He's just like his butt buddy Warren Buffet. I made it, fuck you guys. Now let me white wash it all by throwing some of it down a third world shit hole. It's win/win/win! I win because I'll still have more left over than I can spend in 50 lifetimes and I win again because it's not like those people will ever be an economic threat to me anyway and I win three times because some glad morning those third worlders will be buying Microsoft licenses therefore enriching my grandchildren even further! Muahahahahaha!

What happened to you? (-1)

Anonymous Coward | more than 2 years ago | (#37984446)

Until this minute, I never knew that someone could be as unintelligent as you. If you're trolling, try harder.

Re:What happened to you? (1)

Curunir_wolf (588405) | more than 2 years ago | (#37984582)

Until this minute, I never knew that someone could be as unintelligent as you. If you're trolling, try harder.

He seems pissed, not unintelligent. Can't say I blame him.

Re:And now lets word it to screw the little guy. (1)

Anonymous Coward | more than 2 years ago | (#37984506)

Yeah, why give the guy any credit for being charitable? He should be more like the Koch brothers and just use his fortune to fuck over the middle class directly. That's how you measure integrity these day...

Remember, it's not The Bank's fault they ripped us all off for billions, personal responsibility only applies to poor people, not mega-corporations. I mean, next thing you'll tell me corporations are people...

Re:And now lets word it to screw the little guy. (1)

Anonymous Coward | more than 2 years ago | (#37984544)

Yeah, why give the guy any credit for being charitable?

Much of Bill Gates' money is ill gotten gains. The foundations of his fortune were built when MS was breaking the law prior to their anti-trust trial. They were convicted of abusing their monopoly. Much of the money made afterwards was from the inertia built from the earlier crimes committed. If justice had been served, MS and Bill Gates' fortunes would be 1/10 what they are now and we wouldn't even be having this conversation. I refuse to go along with the Bill Gates kumbaya group-think and praise someone for giving away money that wasn't rightfully theirs in the first place.

Re:And now lets word it to screw the little guy. (0)

Anonymous Coward | more than 2 years ago | (#37984656)

I refuse to go along with the Bill Gates kumbaya group-think and praise someone for giving away money that wasn't rightfully theirs in the first place.

Yes, because so many rich people, like the Koch brothers, earned their billions personally. They didn't, you know, inherit business empires from their parents or anything...that's why they deserve our support while people like Bill who actually produced something himself should be vilified...

Re:And now lets word it to screw the little guy. (1)

oakgrove (845019) | more than 2 years ago | (#37984798)

Yes, because so many rich people, like the Koch brothers

I fail to see how what the Koch brothers do or don't do in any way relates to Bill Gates? Is there some sort of quantum entanglement that I'm not aware of between all of these people? Please enlighten me. Or are you just trying to excuse Bill Gates by saying someone else is worse? With that line of reasoning, everybody can play along and be guilt-free. Hey, that guy might have killed 12 people but at least he's not Pol Pot, herp derp. That's dangerous thinking.

Re:And now lets word it to screw the little guy. (0)

Anonymous Coward | more than 2 years ago | (#37984596)

Yeah, why give the guy any credit for being charitable?

Yeah, I guess if Bernie Madoff had given away a bunch of the proceeds from his crimes he'd be cool too, right?

Re:And now lets word it to screw the little guy. (1)

Bengie (1121981) | more than 2 years ago | (#37984560)

Nearly all of Bill Gate's money will be going to charity once he dies. His kids are only getting something like 10mil a piece, which is is nothing compared to the lot.

Re:And now lets word it to screw the little guy. (1)

oakgrove (845019) | more than 2 years ago | (#37984626)

Could you post a citation that shows that to be legally binding? Otherwise, it isn't worth the electrons you used to post it with.

Re:And now lets word it to screw the little guy. (1)

stanlyb (1839382) | more than 2 years ago | (#37984498)

I just wonder why he forgot about taxing the charities? For example, if you give more than 1 billion dollars for the poor Somalian babies, you have to pay at least flat 15%. Sounds good, ain't so?

There is no Nobel Prize for economics (0, Informative)

Anonymous Coward | more than 2 years ago | (#37984198)

Stop perpetuating a falsehood. There are no Nobel prizes for astrology, professional wrestling, air guitar or economics.

Re:There is no Nobel Prize for economics (1)

jellomizer (103300) | more than 2 years ago | (#37984212)

That is why I play the Air Banjo.

Re:There is no Nobel Prize for economics (1)

Chrisq (894406) | more than 2 years ago | (#37984490)

That is why I play the Air Banjo.

if toy play the air banjo you deserve a prize in air currency (also known as BitCoins)

Bank of Sweden prize in memory of Nobel (2)

tepples (727027) | more than 2 years ago | (#37984256)

But there is a Bank of Sweden prize in memory of Nobel for economics, unlike astrology, professional wrestling, or air guitar.

Re:There is no Nobel Prize for economics (5, Informative)

LoyalOpposition (168041) | more than 2 years ago | (#37984332)

There are no Nobel prizes for...economics.

While, strictly speaking, that's true, it's close enough to the truth as to make little or no difference. There is a periodic prize that's awarded at the same time the Nobel prizes are awarded. This particular prize is given for achievements in economics, and the decision as to whom to award the gift to is made by the same people who award the Nobel prizes. It's called The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. Your statement is little more than an exercise in pedantics.

  ~Loyal

Instead of Financial transactions? (1)

sunr2007 (2309530) | more than 2 years ago | (#37984216)

isnt it more meaningful if they charged this on securities transactions on wall street? why tax the common man just for financial transactions?

Re:Instead of Financial transactions? (0)

Anonymous Coward | more than 2 years ago | (#37984268)

I don't have audio at work so I can't hear what he says in the article, but the summary is highly misleading - as indicated by your take on what it means. It is in fact a "tax on financial transactions" - however a "Tobin Tax" is a tax on exchanges of currency - ie: an international tariff and/or FOREX tax.

Re:Instead of Financial transactions? (1, Insightful)

gfxguy (98788) | more than 2 years ago | (#37984362)

My problem is not simply a tax on exchange of currency, although as someone who travels internationally, do I really have to pay an extra tax to exchange currency? That would suck. It's already too expensive to travel.

No, my problem is that all the government seems to want to do is find new ways to tax people.... they want to tax everything, and the reasons people suggest for doing it are not conducive to economic freedoms and liberty - often they just want to effect social change, which is the wrong reason for taxes.

We don't need yet-another-tax, we need a tax system overhaul that simplifies and removes loopholes. The Tax Foundation (link in my other post on this subject) suggests the costs of compliance to be in the hundreds of billions of dollars.... why make it worse?

Re:Instead of Financial transactions? (1)

x1r8a3k (1170111) | more than 2 years ago | (#37984496)

When I heard of this way back when, this kind of tax was supposed to replace most other taxes. That part seems to have been lost somewhere along the way though.

Re:Instead of Financial transactions? (5, Insightful)

mcgrew (92797) | more than 2 years ago | (#37984574)

No, my problem is that all the government seems to want to do is find new ways to tax people..

"The" government? I pay taxes to more than one government. There's Federal tax, state tax, and local tax. As to the Feds, Federal taxes are lower than they've been in 60 years. TFA is a red herring; rather than taxing financial transactions, why not simply tax Capital Gains as income (as well as get rid of loopholes like the mortgage deduction and the charity deduction)? Why should someone who "earns" $75k gambling on the stock market pay half the tax of someone earning $75k working as a roofer? The stock answer to that is "the stock market investor has huge risks!" Really? He's only risking money, the roofer risks his very LIFE.

The stock market gambler should be paying twice the tax the roofer pays. The roofer is creating wealth, the gambler simply shuffles it around and leeches off of it. TAX WALL STREET.

Re:Instead of Financial transactions? (1)

fuzzyfuzzyfungus (1223518) | more than 2 years ago | (#37984688)

Are you seriously suggesting that precious Capital is worth more than some roofer who could be replaced by an undocumented immigrant for 1/3 the price tomorrow?

You must be one of them commies I've been warned about...

Stocks, bonds, derivatives, or foreign currency (3, Informative)

tepples (727027) | more than 2 years ago | (#37984284)

Did you read the next page of the article [bbc.co.uk] with the guy dressed up like Link from The Legend of Zelda? Proposals include a tax on large trades in stocks, bonds, derivatives, or foreign currency.

Re:Stocks, bonds, derivatives, or foreign currency (2)

Culture20 (968837) | more than 2 years ago | (#37984388)

Did you read the next page of the article [bbc.co.uk] with the guy dressed up like Link from The Legend of Zelda? Proposals include a tax on large trades in stocks, bonds, derivatives, or foreign currency.

Like rupees.

Re:Stocks, bonds, derivatives, or foreign currency (5, Insightful)

PopeRatzo (965947) | more than 2 years ago | (#37984614)

Proposals include a tax on large trades in stocks, bonds, derivatives, or foreign currency.

It should not be limited to large trades.

Right now the high-frequency traders are basically stealing. They jump in front of other peoples' trades by milliseconds, holding no trade position at the end of the day. It has nothing to do with the purpose of a stock exchange. It does not create capital, value or liquidity. It's a hack, pure and simple, and it's costing the rest of us a ton of money by increasing volatility where there would otherwise not be volatility. They are the griefers of the financial sector.

All you'd have to do is make this a very small tax for it to have a very positive effect, both on the bottom line and on the health and stability of the marketplace.

Plus, since we're talking about a very small amount, it would not hurt all of the retirees who were suckered into 401ks and Roth IRAs instead of proper pensions.

Re:Instead of Financial transactions? (1)

fuzzyfuzzyfungus (1223518) | more than 2 years ago | (#37984320)

I'm pretty sure, given the context(and the fact that things like sales taxes are already common, not novel and interesting proposals), that 'financial transactions' means 'transactions conducted in Finance, capital F', the sort of wacky securities stuff that has caused a bit of trouble in the past few years...

I'm sure that we'll hear soon enough that the dead hand of government wishes to prevent granny from retiring on her 401k; but that this isn't a sales tax proposal(except to the extent that it might make the sale of securities closer to being subject to the same conditions that presently govern the sale of actual goods and services...)

A first (5, Insightful)

tbannist (230135) | more than 2 years ago | (#37984238)

This might be one of those rare times when I actually agree with Bill Gates. A tax on financial transactions should reduce or stop some of the most exploitive behavior in the financial world. "High frequency" trading would become much less profitable, as would the even less ethical exploit of attempting to generate out of date quotes by overloading a trading system system.

Re:A first (0)

Anonymous Coward | more than 2 years ago | (#37984288)

you moron. His percentage of this tax would be far, far less than for you, because his is not paying for much out of his pocket, you are.

Re:A first (5, Insightful)

sycodon (149926) | more than 2 years ago | (#37984336)

While I'm on the fence about the tax, I am definitely with you on making high frequency trading as difficult and least profitable as possible.

HFT is what crashes markets at a moment's notice. It can destroy companies in a matter of minutes. And it also an affront to the entire concept of a market where well informed buyers make well informed decisions about the value of a product.

Re:A first (1)

JoeMerchant (803320) | more than 2 years ago | (#37984350)

"High frequency" trading would become much less profitable.

Any tax at all on high frequency trading would make it unprofitable. If we don't slay that monster (HFT) soon, it will build itself a economic-political fortress that will be very hard to tear down.

Re:A first (0)

Anonymous Coward | more than 2 years ago | (#37984780)

The voumnes on bank of ireland suggest HFT to me, as far as I'm aware there is a 1% transaction tax on purchasing shares on the ISE. http://finance.yahoo.com/q?s=bir.ir&ql=1 [yahoo.com]

Re:A first (0)

Anonymous Coward | more than 2 years ago | (#37984392)

Americans try to solve all the world's problems with a tax. It makes no sense.
If you want to stop high frequency stock trading, just require all stock to be held for two weeks before they can be traded again.

This would be much better for establishing stability in the markets.

Re:A first (4, Insightful)

Dunbal (464142) | more than 2 years ago | (#37984462)

Americans try to solve all the world's problems with a tax. It makes no sense.

No, they are just trying to solve one problem with tax - the fact that they are bankrupt. They are bankrupt, however, because they try to solve all the world's problems by spending money.

This would be much better for establishing stability in the markets.

High frequency trading results in very stable markets. To wit, I present the case that the market is at the same place it was since 1998. If jogging in place for 13 years isn't "stability" I don't know what is.

Re:A first (3, Interesting)

Sique (173459) | more than 2 years ago | (#37984464)

Then you get lots of shady agencies whose whole task it is to be the "owner" of said stock for two weeks, while the "rights to get the stock after two weeks" is changing owner at high frequencies - you have just invented a new kind of derivate, the option to buy stock after a two weeks period.

Re:A first (0)

Dunbal (464142) | more than 2 years ago | (#37984410)

Yes, and with high frequency trading - and trading in general - being less profitable you can expect less liquidity, larger spreads between the bid and ask price, and much greater volatility in the markets. Well done.

Re:A first (5, Insightful)

Nursie (632944) | more than 2 years ago | (#37984458)

Yup, because the whole stock market was a volatile mess before HFT came along, and now that we have this miracle mechanism, nothing EVAR goes wrong.

EVAR.

Re:A first (1)

LordLimecat (1103839) | more than 2 years ago | (#37984818)

Wow, fallacy alert. Thats totally not what parent said; he simply said that trading being less profitable would not help things.

Re:A first (2)

BBCWatcher (900486) | more than 2 years ago | (#37984500)

Somehow, prior to high-frequency trading, the world had plenty of liquidity, extremely narrow spreads, and not any more volatility than today (and probably less). I think the (real) world will do just fine without HFT.

Re:A first (1)

LordNacho (1909280) | more than 2 years ago | (#37984734)

This is quite simply not true. Please look at evidence before you make sweeping statements like that. The data goes back quite far before the time of HFT.

Re:A first (2)

BBCWatcher (900486) | more than 2 years ago | (#37984788)

I have looked.

Re:A first (4, Insightful)

itsdapead (734413) | more than 2 years ago | (#37984554)

Yes, and with high frequency trading - and trading in general - being less profitable you can expect less liquidity, larger spreads between the bid and ask price, and much greater volatility in the markets. Well done.

Or, to put it another way, more incentive to hold on to shares as long term investment and maybe start giving a fuck about whether the enterprises they represent are actually creating sustainable wealth, and think about the wider consequences of the trades you make, rather than treating them as casino chips. But, hey, if it ain't broke don't fix it. Oh, wait, it is broke...

Plus, in case you haven't been reading the news for the last 3 years, the financial sector owes us some money.

Re:A first (0)

Dunbal (464142) | more than 2 years ago | (#37984674)

This would be the ideal scenario. I don't see how a tax would suddenly make people ethical though.

Plus, in case you haven't been reading the news for the last 3 years, the financial sector owes us some money.

No - credit was created and credit disappeared. No one owes anyone anything. Of course the poor bastard who thought he could afford a house when really he couldn't ends up feeling cheated. And the poor bastard who bought mortgage backed securities on a promise from a salesman without realizing what he was buying or doing due diligence feels cheated. And the government that prints money to give to banks to lend to corporations to try to stimulate "growth" and then doesn't get the growth it wanted feels cheated when it finds out that after all, ink and paper is just ink and paper and doesn't actually create wealth. But at the end of the day people who don't take care of their money don't deserve money anyway.

I personally haven't been affected by the problems in the past 3 years (apart from my gold quadrupling in price - but I ain't selling). Neither has my wife. The ones that have lost out are the ones living on credit, the ones living beyond their means, and the ones who thought that (insert fancy job title here) actually meant something. But all that has happened is the veil has been lifted. The ones who thought they were rich found out they aren't rich after all, and the ones who thought they weren't poor found out that they are still poor after all.

Re:A first (3, Insightful)

JasterBobaMereel (1102861) | more than 2 years ago | (#37984844)

I don't live on credit, Don't have a mortgage, my wages now buy less than they did ... and there is little prospect of them going up any time soon ... Can I have my buying power back please

Re:A first (1)

Hatta (162192) | more than 2 years ago | (#37984426)

Of course, he comes out in favor of this tax now, when he's already in the process of giving away his billions.

Re:A first (4, Insightful)

Anonymous Coward | more than 2 years ago | (#37984452)

He earned his billions by actually producing a product rather than shuffling money around in HFT. I didn't like some of Microsoft's business practices when he was running the show, but it's not even in the same league as Gold Mansacks.

Re:A first (1)

Greyfox (87712) | more than 2 years ago | (#37984636)

I know right? All that stuff about malaria mosquitoes? Doesn't he realize that eradication efforts have already reduced populations of malaria mosquitoes from billions to somewhat smaller billions? If we don't act fast, the endangered malaria mosquito could disappear from the world! FOREVER! Oh sure, if it's a cute panda bear everyone gets all teary-eyed, but does anyone mourn for the poor endangered malaria mosquito? I'm glad you're with me on this!

Anywhoo, high frequency trading, just put all orders into a queue, and then randomize and process them every random couple of minutes or so. Seems like a much easier solution, and not too hard to mandate. If you need to buy or sell RIGHT NOW you're not investing, you're gambling. And that should be taxed on gambling income rates. Actually if we could figure out how to classify everything that Wall Street does that's gambling AS gambling and tax it as gambling, Wall Street would be a lot quieter.

No love for financial institutions. (5, Insightful)

gfxguy (98788) | more than 2 years ago | (#37984286)

... but the government needs to overhaul the system of taxation to a simple system without loopholes, and stop trying to figure out a way to tax everything we do. Once upon a time we didn't even need income taxes; times change, but having the government intrude on every aspect of our lives so that they can tax every little thing is not the way to go.

You have to ask what is the purpose of taxes to begin with; why do we need them and what's the most effective way to accomplish that, not keep coming up with new schemes that likely can have negative impacts on the economy. Every time the government creates a new tax, the cost of compliance adds to the amount that the government collects; more accountants need to be paid, more paperwork needs to be filled out.... the cost of compliance for the current system (not the taxes paid, but the resources spent figuring out what to pay). The tax foundation projects compliance costs to be in the hundreds of billions (Total Federal Income Tax Compliance Costs, 1990-2015 [taxfoundation.org] ).

There's got to be a better way - overhaul the tax system, don't keep adding to the mess it already is.

If we don't stop this nonsense, we're going to be taxed for every action we take and the fourth amendment will be a joke. You'll have a federal tax on food (eat beef? Well, beef causes global warming, so you'll have to pay), a commute to work tax; have coffee break tax; drive anywhere tax (this will be beyond what we already pay in gasoline taxes). Every time money changes hands? Is that what you really want? Lend me $20 and pay a tax? How about both of us? Lender tax and borrower tax, and then a pay-you-back (loan repayment) tax. How about a tax on getting money from your ATM? Or transferring money from one account to another? Or every time you pay a bill? It's simply ridiculous to continue along this path.

Re:No love for financial institutions. (1)

Twinbee (767046) | more than 2 years ago | (#37984366)

Exactly. I despise the way so few governments care about admin and the hidden cost that is. Simplicity like you say is the key. Even if it makes things a tiny bit less fair overall, it more than makes up for it in paperwork (or the lack thereof). Another case of UWS (unnecessary work syndrome).

Do you know of a website which promotes a much simplified and universal tax scheme?

Re:No love for financial institutions. (1)

gfxguy (98788) | more than 2 years ago | (#37984610)

Do you know of a website which promotes a much simplified and universal tax scheme?

I do, but if I post it the topic will go off on a tangent of misinformed people bashing the suggestion, despite years and millions of dollars of non-partisan research behind it.

The problem is there's no such thing as a "perfect" system of taxation; there's no system everyone will agree is "fair," and very often people jump on my suggestion because, as a revenue neutral system, it doesn't do anything to solve the spending crisis the U.S. government is having (although, as a means to drive the economy it certainly could mitigate that problem).

People bash this idea because people can cheat the system (ignoring what they do now); they bash it because, as is, doesn't collect enough revenue to cover the U.S. budget (ignoring that that's how it is now); they bash it because they say it's regressive (although people at or near the poverty line will see their spending power increased).

Wouldn't it be great to have a system that encouraged earning and saving? A system where the government wouldn't have to intrude on your fourth amendment rights the way they do now? A system where companies and the very wealthy don't feel the need to shelter their money offshore? A system that would encourage businesses to come here instead of the other way around? A system where the government doesn't take interest free loans at your expense through withholding?

I am talking about the FairTax [fairtax.org] . No, I don't like the name. No, I don't think it's perfect. No, I don't think prices will come down enough to completely cover the cost of the FairTax as the authors suggest (although I do believe prices will drop when embedded taxes are removed). Yes, I am middle class. No, I don't think the wealthy will stop buying goods and services to avoid paying taxes.

Lastly, no, I'm not going to argue about the FairTax here. Most people are wildly misinformed about it, and make up straw man arguments about it to complain about, like how much it would "really" have to be (well, you know what taxes "really" have to be under the current system in order to cover the U.S. budget? Here's a clue: tax the wealthy at 100% and you're still not even covering the deficit):

Even if individuals earning more than $200,000 were taxed at a 100 percent marginal rate--and we confiscated their passports so they could not flee--the take would come to $1.27 trillion, or just 77 percent of this year's deficit.

(source: Not Taking Other People's Money [aei.org] ).

I'm sick of defending the FairTax, with all it's positives over the current system, from complaints that apply equally the current, and every other, suggested system.

So there you have it: the FairTax would be a massive simplification; would not require government intrusion into your private lives; would repeal the 16th amendment; would be a boon to businesses and encourage offshore businesses to come home, and encourage foreign businesses to move here. People whine that they wouldn't get their deductions on things like home mortgage interest... of course you would; not just the interest, either - but the principle. But they can't wrap their heads around it and never come up with something better.

Re:No love for financial institutions. (0)

Anonymous Coward | more than 2 years ago | (#37984682)

Even if individuals earning more than $200,000

LOL. Corporations are people too.

Until tax time comes, then they run screaming and crying.

Re:No love for financial institutions. (1)

Anonymous Coward | more than 2 years ago | (#37984834)

Pay no attention to the sock-puppets trying to appear as a legitimate conversation.

They're just paid drones trying to sell you on a new tax plan that will make it much easier for corporations and wealthy people to avoid paying any taxes altogether. Also known as Flat Tax and Fair Tax, respectively.

Re:No love for financial institutions. (5, Insightful)

Antimatter3009 (886953) | more than 2 years ago | (#37984460)

Absolutely. I don't understand what's so hard about saying "regardless of its source, all of your income just counts as income, minus some deductions, and you pay a percentage in tax based on these brackets". No special taxes, no loopholes, you just take your total income, put it in brackets, and pay the percentages required. I'm far from an expert so maybe I'm missing something, but I'd love to hear it. This seems so clear cut and simple.

Re:No love for financial institutions. (5, Insightful)

Anonymous Coward | more than 2 years ago | (#37984466)

I think you missing the point of transaction tax. In this particular case, the goal is not so much to create new source of revenue, but to make most dangerous (for the world economy as a whole point of view) trading practices unaffordable. High Frequency Trading makes tons of money out of thin air. No one gets any better except select few trading houses which have enough muscle to participate in this. The transaction tax may have many consequences, but at the very least it will make stock market little bit less rigged.

Re:No love for financial institutions. (0)

Anonymous Coward | more than 2 years ago | (#37984590)

High Frequency Trading makes tons of money out of thin air

How is this any different than the Federal Reserve?

Re:No love for financial institutions. (1)

bhmcintosh (19563) | more than 2 years ago | (#37984478)

(If you drive a car ), Iâ(TM)ll tax the street,
(If you try to sit ), Iâ(TM)ll tax your seat,
(If you get too cold ), Iâ(TM)ll tax the heat,
(If you take a walk ), Iâ(TM)ll tax your feet.
Tax man...

Government is a business (0)

Anonymous Coward | more than 2 years ago | (#37984482)

and their goal is profit, same as any private business. Prove me wrong.

Re:Government is a business (1)

pla (258480) | more than 2 years ago | (#37984742)

A business has accountability to its shareholders. Governments lack even that weak of a damper on their abuses.

Re:No love for financial institutions. (2)

wye43 (769759) | more than 2 years ago | (#37984524)

Taxes are not about fairness, but about what can and cannot be done. If the government can get away with taxing you for drinking water, they will do it.

Running a state is not cheap, and any government that will come clean and come up with ONE tax of 95%+ will get overthrown immediately, even if that's the truth, that amount is really required. People want to be lied, they want to pay 300+ different taxes so it sounds they are not paying that much.

E.G. Denmark will tax you 180% on a car saying that its for the environment, but the truth is they don't have an internal car industry (that would be hurt by such tax).

Re:No love for financial institutions. (3, Insightful)

Kjella (173770) | more than 2 years ago | (#37984538)

... but the government needs to overhaul the system of taxation to a simple system without loopholes, and stop trying to figure out a way to tax everything we do. Once upon a time we didn't even need income taxes; times change, but having the government intrude on every aspect of our lives so that they can tax every little thing is not the way to go.

Unfortunately, the government isn't the only problem here. Here in Norway we have an oil fund yet at the same time lots of toll roads and toll circles around cities. We're taking up debt so loaning and saving at the same time, while adding a bunch of overhead to boot and really the result is often unjust all the same. We'd do a lot better just adding to the petrol tax and saying that yes we're maintaining a road network, some of you get a new road and others don't but it even outs over time. Instead we have to try millimeter-measuring out costs with tolls. But you'd also get a shitstorm of people feeling this is unfair. People are very much there that "I don't want to pay for that road, let those that use it do" and then you have to keep track of who's using it and who's not. Now it's just electronic pass keys and photo identification, no anonymous cash payments. Somewhere there's a record of every car passing every toll point, which supposedly gets deleted but it certainly is collected.

Re:No love for financial institutions. (1)

Ihmhi (1206036) | more than 2 years ago | (#37984664)

I've looked into stuff like FairTax and other flat taxes and I hear about how it's unfair. I really think this is more FUD than common sense.

It's hard to get more fair than a completely flat tax. Millionaires or billionaires could not completely avoid it because they have to spend money and you wouldn't be able to use a shell company to make personal purchases.

Lastly, the FairTax (and similar plans I've read about) often have exceptions below a certain income level. I've often heard this cited as unfair against the more economically successful, but isn't this one of the major points of a modern society? We're supposed to take care of our fellow man - especially the ones that are not in a position to be able to care for themselves. The same logic against a flat tax could be applied to cutting Social Security, Medicare, etc. because those also cost us a fair bit of money and largely help out the poor and middle class.

Re:No love for financial institutions. (1)

gfxguy (98788) | more than 2 years ago | (#37984812)

FairTax does not have exceptions; although I loathe the name, that's why they call it "fair," because it applies exactly the same to everybody.

Everybody would get the "prebate," (based on number in the household - which would be the ONLY information you'd have to give the government). Even the rich would get the prebate (even if it's mostly meaningless to them).

That makes things taxable at the same rate, regardless of what they are... milk would be the same as pizza, because instead of tweaking what gets taxed and how much, everybody just gets the prebate to cover the amount they'd spend in taxes on the basic necessities.

Mathematically, those at or near the poverty level have increased spending power under the FairTax because not only are they getting their pay check with no federal income tax withholding (which should already be the case), they are also getting their paycheck without payroll taxes (SS and medicare), which the FairTax accounts for. Add in the prebate, and they are not paying any federal taxes at all up to the poverty level.

It's not a perfect system, and there's no system that everyone will agree is "fair," it's just the best suggestion I've ever seen.

Re:No love for financial institutions. (1)

mcgrew (92797) | more than 2 years ago | (#37984676)

How about a tax on getting money from your ATM?

You're already paying it, it's a high tax, and not a penny of it goes to the government.

Or every time you pay a bill?

Have you ever looked at your utility bills? Already taxed to the hilt.

Re:No love for financial institutions. (1)

chrisphotonic (2450982) | more than 2 years ago | (#37984786)

I'm with you. This will also mean they HAVE TO track every friggin thing you do.

This seems like this will be another double barrel gun blast into the chest of privacy.

Re:No love for financial institutions. (1)

fearofcarpet (654438) | more than 2 years ago | (#37984796)

High frequency trading (HFT) amounts to a tax that large financial firms levy by effectively inserting themselves in the transactions of third parties. If you agree that it is detrimental to the country, then how do you get rid of it? You can make a law against it, but enforcement costs money. You can tax it, which creates additional paperwork, but also generates revenue.

Thus, you have three options:
1) allow HFT to continue unfettered
2) spend money enforcing a law to prevent/curb HFT
3) make money by levying a tax against HFT and adjust the tax to achieve the desired level of HFT

I fail to see how simplifying the tax code impacts HFT...

Awwwwww Bill!!!! (-1)

Anonymous Coward | more than 2 years ago | (#37984298)

We GET it! You're a really rich dude who would probably agree to a tax on every time you poop but for the rest of us slobs this is a "pour some toilet water on it" solution.

P.S. The original Tobin tax seemed to be trying to lessen currency arbitrage but governments (as usual) try and hit everything with the same hammer.

Be wary of taxes that billionaires want (1)

MikeRT (947531) | more than 2 years ago | (#37984334)

Many liberals who think George Soros is a great guy for supporting this "tax on the rich" don't realize that Soros is one of the rich guys who stands to profit handsomely from it [lewrockwell.com] :

With markets less liquid, the market makers that make the markets liquid and efficient will be hampered by a Tobin tax (they will now need a spread of over 1%) and this will create more profit opportunities for the position trading that Soros does.

In other words, it's not clear that the Tobin tax would actually make the markets safer for small investors or hold the high-power players at Goldman Sachs accountable. The only thing that is clear is that very rich position traders with the ability to move significant amounts of capital will gain a very profitable advantage.

Part of this is aimed at punishing the high speed traders. I think a better approach to that would be to pass a law requiring full access to the stock exchanges at very low rates. The stock exchanges are hardly capitalist to begin with, so pushing a massive unfunded mandate on them is just a price they pay for the privilege of maintaining one of the last vestiges of mercantilist privilege in the modern world.

Re:Be wary of taxes that billionaires want (1)

BBCWatcher (900486) | more than 2 years ago | (#37984588)

High-frequency (program) traders make big investments in computing that is located as close as possible to trading floors. They employ extremely expensive programmers to write highly proprietary code to run on these machines located on prime real estate, in speed of light terms. That's exclusively a rich man's (or firm's) game. I'm hard pressed to think of any way in which such trading helps allocate capital materially better to the real economy, which is the only useful purpose of finance. It's a grand waste of talent and resources that could be put to much better use elsewhere in the economy.

The slashdot summary is wrong (1)

Anonymous Coward | more than 2 years ago | (#37984356)

The summary says "large economies like Germany, France, and the U.S. have expressed interest in his plan". That's not what I hear in the video. The host says america doesn't want to do it and then bill says they're unlikely to do it. The host then says china and britain don't want to do it either, and "the list goes on", and bill smiles and nods in agreement.

Re:The slashdot summary is wrong (0)

bluefoxlucid (723572) | more than 2 years ago | (#37984386)

As people advocate taking the living shit out of everything to fix all our problems, I recall France beheading everyone because they were taxing the living shit out of everything to the point of completely destroying the economy...

Re:The slashdot summary is wrong (1)

Sponge Bath (413667) | more than 2 years ago | (#37984528)

As people advocate taking the living shit out of everything to fix all our problems...

The article is about a modest tax on a specific activity to address a particular problem.

I recall France beheading everyone...

Which is why there are no more French people... oops, pointless hyperbole leads to absurd conclusions, yet again.

Gotta love these rich people (-1, Flamebait)

Dunbal (464142) | more than 2 years ago | (#37984376)

Isn't it nice when fabulously wealthy people who have ALREADY MADE THEIR FORTUNE advocate making it harder for the rest of us to make a buck? I'm sure Mr. Buffet will never worry about money for the years he has left; and Mr. Gates who has already moved most of his assets into a loophole (sorry, "Foundation") to protect his progeny's inheritance from taxes, certainly shouldn't worry about the future.

Meanwhile for the rest of the people who are having their homes foreclosed for being late on a mortgage payment even when the bank can't prove who actually holds the mortgage (if anyone) because they botched the paperwork, well, life still sucks.

Re:Gotta love these rich people (1)

Haxagon (2454432) | more than 2 years ago | (#37984510)

Seven puppies were harmed during the making of this post..

With that attitude, I'm not surprised.

Re:Gotta love these rich people (4, Interesting)

Dog-Cow (21281) | more than 2 years ago | (#37984518)

I don't know about Gates, but Buffet is well-known for bemoaning the fact that he pays less (as a percentage) in taxes than his secretary does. I have never heard of him advocating any changes that would increase the tax burden on the Middle-class relative to his own. Quite the opposite, actually.

100% inheritance tax (0)

Anonymous Coward | more than 2 years ago | (#37984572)

100% inheritance tax. If you want to leave something for your kids, DO IT WHILE YOU'RE ALIVE. If they haven't made it with all the benefits if your money and the connections that come from money, then they're not going to do any better when you're dead.

And taxing 100% means someone like Paris Hilton wouldn't be able to make money by coining it off her dad's wealth.

Re:100% inheritance tax (0)

Anonymous Coward | more than 2 years ago | (#37984764)

You are transparent and I'm telling your dad and he's going to leave it all to charity because you are just a spoiled bastard. No, you have to wait until he's dead so tough shit.

Get a life (1)

spectrokid (660550) | more than 2 years ago | (#37984584)

This is so typical. Excuse me if I assume you are American. High-speed trading is the seed to the next financial meltdown. I am not an expert, and no I can not explain exactly how it will happen. But I have enough common sense to bet you one very nice bottle of redwine that it will lead to disaster, unless of course our politicians exceptionally get their shit together and stamp it out like the rotten pile of shit it is. I like Sarkozy's idea: a tax based on how long you keep the shares. No tax if you keep it longer than a year, 1% for longer than 6 months etc. I can pick any "occupy wallstreet" moron of the pavement and explain him how bonds and shares allow people to start businesses and create jobs. He WILL understand that their existence is beneficially to our society. I still have to meet the first guy who can explain me the benefits of microsecond trading to our economy.

Re:Gotta love these rich people (1)

dkleinsc (563838) | more than 2 years ago | (#37984652)

Mr. Gates who has already moved most of his assets into a loophole (sorry, "Foundation") to protect his progeny's inheritance from taxes, certainly shouldn't worry about the future.

I think the Gates Foundation would be in more than a little trouble if they started making large payments to Melinda or Bill's children. Both Bill Gates (and Warren Buffett as well) have made it quite clear that their philosophy is that they don't want their kids to inherit ridiculously huge gobs of money, just something in the low 7 figures.

Will never pass (3, Interesting)

Pecisk (688001) | more than 2 years ago | (#37984378)

My feelings is that banks are heaviest lobby what are in this world - they own money we need to keep to run this charade called Capitalism. They will hold governments hostage til they will relent on this.

I really hope that someone will proove me wrong, but this doesn't give any hope:
" The Chancellor George Osborne has delayed his return to London from Brussels this lunchtime after a row over proposals for a financial transaction tax at a meeting of European Finance Ministers.
        According to sources Mr Osborne asked what was the point in even having a conversation about the financial transaction tax given that it was going to be rejected and then asked if it was âoethe best way to spend our timeâ.
        I understand that the Chancellor said no bank would end up paying the tax and the final payer would be pensioners."
http://www.bbc.co.uk/news/uk-politics-15640299 [bbc.co.uk]

As said Will Emerson in Margin Call (played briliantly by Paul Bettany): "One thing I can say for sure: they never loose their money".

Re:Will never pass (1)

arth1 (260657) | more than 2 years ago | (#37984414)

As said Will Emerson in Margin Call (played briliantly by Paul Bettany): "One thing I can say for sure: they never loose their money".

This is true. But sometimes they lose it.

Re:Will never pass (1)

mcgrew (92797) | more than 2 years ago | (#37984762)

I don't think that's a typo, the banks should indeed loose more money. It's damned near impossible to get a mortgage or small business loan these days, money's way too tight. The banks loosing money could jump start the economy.

Misleading post! (3, Informative)

WileyC (188236) | more than 2 years ago | (#37984390)

The "Tobin tax" specifically targets currency trading, not "financial transactions" in general. In fact, the title/body of the original article are so misleading, it should probably be yanked as troll bait. All the gory details can be had here: http://en.wikipedia.org/wiki/Tobin_tax [wikipedia.org]

Re:Misleading post! (5, Interesting)

dkleinsc (563838) | more than 2 years ago | (#37984704)

The original Tobin Tax was targeting currency trading, but other economists since have proposed it for securities trading as well.

It tends to hit mostly the high-frequency traders and the big hedge funds who are constantly shuffling huge sums of money around. It has very little effect on somebody who makes a few trades a year as part of a smaller individual investment portfolio.

And Suddenly... (1)

Qatz (1209584) | more than 2 years ago | (#37984396)

And suddenly cash is illegal! Why? Because they can't tax every cash transaction. Now paying a kid 5 bucks to cut your lawn would be tax evasion.

Re:And Suddenly... (1)

Dunbal (464142) | more than 2 years ago | (#37984548)

You are far closer to the truth than you think. Cash transactions over 5000 Euros are now illegal in Italy [zerohedge.com] . Greece also wants to make cash illegal [dailyreckoning.com] for some transactions. Oh it's all being done in the name of preventing crime and money laundering, but it's fairly obvious that since electronic transactions are much easier to monitor, governments are salivating at the thought of forcing us all under their microscope.

First they make a law but only apply it to large transactions that people don't normally pay cash for anyway - buying a house, or a car. Then two things happen. First, they can move the goalpost closer to zero over time. Secondly (and this is the magic part), inflation will move everyone over the barrier over time anyway. In 40 years or so when a grocery bill is 5000 euros, or 100 years when a pack of chewing gum is 5000 euros, then effectively all cash transactions will be illegal without actually having to do anything at all. Governments are dangerous - the only thing they can ever do is take from you. They can never give you something you didn't already have. But people just don't care.

Screw Gates (0)

Stumbles (602007) | more than 2 years ago | (#37984432)

The last thing needed is more taxes. This is a pipe dream but governments should stay within their budgets.

re: a tax must bring extra value to those who pay (1)

nik_qc (1202403) | more than 2 years ago | (#37984438)

I am sure Bill can afford paying extra. For an average investor it means my cost of investing - and cost of all financial services everyone is using - will increase. Probably by a small margin, depending how greedy the government would be - but still. Personally I am always against any additional tax that does not bring any value to me as to the user of the service in question. Am I going to be better protected against corporate fraud? Against my broker's misconduct? Against other types of crime that are associated with financial industry? No, this tax is to patch a small hole somewhere else. If I am to pay extra for a particular service, I have to be compensated by lowering the generic income tax. I am all for "pay per use" model, even when it is applied to the government system - but it has to be fair and "pay per use" implies "do not pay for what you do not use". As long as this rule does not work, I would be against any additional specialized taxes.

Would Kill all Banks (0)

Anonymous Coward | more than 2 years ago | (#37984470)

So let me get this straight. When I want to transfer money from my checking account to my credit union savings account, I would pay a tax on it? When I make a PAYMENT on my credit card, I would pay a tax on it? When I donate money to my favorite charity, I would pay a tax on it?

Those are all considered financial transactions, and so they would all be taxed.

All stocks/commodoties/money should have the .5% (2)

GoodNewsJimDotCom (2244874) | more than 2 years ago | (#37984494)

If you put a 1% or .5% transaction fee on all stocks/commodities/money exchanges, it would put a hurt on high frequency traders. People would be more inclined to invest for a longer run. The tax should be completely undodgeable with no writeoffs being able to prevent it as it comes part of the cost of the transaction.

Hurts middle class most (1)

Curunir_wolf (588405) | more than 2 years ago | (#37984556)

This is a tax that will be paid almost entirely by the middle class. The wealthy have ways to avoid it, and low income folks will mostly not see any impact. But for the vast majority of the middle class, either working for an employer that practically requires pay to be made direct deposit, with loans that are direct draft, with lots of reliance on banking transactions, most of which are entirely unavoidable, will find their accounts draining even faster. Isn't the gouging by the banks of their small customers enough for people to deal with, now the government is going to dig in and make the account drain even faster?

Re:Hurts middle class most (2)

max2312312 (2486294) | more than 2 years ago | (#37984822)

You already pay this tax because the HFT guys are front running you. But I would agree that an exemption for some amount of trading makes sense.

Higher taxes only affect some wealthy... (5, Interesting)

MetricT (128876) | more than 2 years ago | (#37984566)

Here's my economic theory of taxing the wealthy. You won't find it in any textbook. It may be right, or it may be crazy...

There are two types of wealthy people: the ones that actually create economic value (the Buffets, Jobs, and Gates of the world), and the ones who don't.

The latter became rich, not because of what they accomplished, but because they knew the right people. Went to the right schools. Had executive hair. Had charisma, but no actual ability hiding behind it.

If you're actually a source of economic value, taxes don't affect you as much as you'd think. Government takes, gives to the poor, makes them a bit richer, and they end up buying more of your product. There may not be a 1:1 correlation, but $1 in new taxes probably ends up being far less than $1 out of their pocket when all is said and done. It may even make you more money.

If, on the other hand, you're rich purely because of luck, then a higher tax rate affects you a lot more, because you can't count on the wealth you lose being recirculated to you. It will end up going to an actual value creator and not you.

That's why the Buffets and Gates of the world don't sweat higher taxes too much, and why you hear so much wailing and gnashing of teeth from Wall Street types over the very idea.

My 2 cents, anyway.

When did Wall Street prove it was useful? (4, Insightful)

Vitriol+Angst (458300) | more than 2 years ago | (#37984696)

We get so excited about the debate of "should we tax or shouldn't we" -- we forget the debate about; "Why do we have a 'Wall Street' to begin with?"
Turning over a stock in anything less than three years, and definitely less than 1 year is NOT an investment in a company -- it's an attempt to "play the market." One or two day traders might win at this -- but the professionals, who have machines that can trade in nanoseconds and shave time with the competition by using shorter network lengths to WS computers for trades are going to win. Market manipulation is also too lucrative to worry about the SEC and such -- much better to buy the regulators (as we've seen).

>> However, when we consider the Trillions more that our Government had to bail out Wall Street more than just the public "TARP funds" -- and that banks like Bank of America might be posting bigger losses in the range of $75 Trillion with the FDIC backing them. So a few pennies a trade will require a few hundred years just to PAY BACK expenses they've incurred -- much less "cover" future risks.

Another way to say this is; who is MORE crazy? The person who wants to tax the Mafia or the person who thinks you cannot trust the mafia in the first place? There is no way a group that can get the FDIC to cover $75 Trillion in "bad bets" after the fact, and AFTER a bail out for the same "mistake" (I call it fraud), is a group that CANNOT get around any tax. The Day Trader will see a tax, but if there is enough of a fee to stop the market manipulators -- be sure that they will get compensated where you are not looking.

Wall Street's EXCUSE to suck up 40% of all profits is that they help provide funds to let companies grow -- having seen the rampant leveraged buyouts, the VC funds used to sell away parts of companies, and the shuttering of tens of thousands of businesses to provide "fodder" for Hedge Funds -- it's a bit like allowing a Mercenary to continue to operate in a country after wiping out a town, because you've seen him walk a little old lady across the street once.

I once made my living with Financial Services companies -- but it felt a bit like carrying ammunition for a mercenary. Biting the hand that feeds you should be a mark of integrity, and I'd like to make a living building something or making the world a better place. ALL Financial services are a ruse, because they are predicated on "investing wisely" -- which is always a pitch of "getting back more than you put in." For every wise investment to do better than just the average of stocks, SOMEONE has to lose. By the time a company has stocks on Wall Street, it's either on someone's menu or it has all the money it needs -- and some VC firm reaped that benefit before you did.

Well sure, he's made his money. (0)

Anonymous Coward | more than 2 years ago | (#37984708)

Thanks for nothing Bill.

WFT? (0)

Anonymous Coward | more than 2 years ago | (#37984820)

The government already tax on the profit anyone made in the capital market, HFT or not. If HFT is such a profitable strategy, the institution that operate it already pay a lot of tax on the profit.

Why a second tax? So they want to tax the losses too? So that they can feed their addiction? Feed the hungries? Or feed the world? To be fair, they should also tax casino for every bets are made. I think it is gambling is a bigger social problem than HFT. Yes, Bill's investment in FB really help the society. FB is not an innovation, it is a website that allow you to do communication differently. ASIMO, the Honda robot, is an innovation, I don't see him promoting that, feed the hungry mind with the right information.

How about increase gas tax by 1000% in 20 years? Pollution is such a problem, I just read a headline about CO2 emission is worst than worst case scenario. It is a life or death issue of the entire human races. Financial market crash? Who care, it is just money after all. Wake up people, your government is steering in the wrong direction, and since US is a big part of the world, it is driving us, the entire human race into the ditch. Greece is not the problem, you are. I can't wait until China and India become bigger and stronger than the US.

Finally, if the US government promise to use the entire collected transaction taxes in space program? I would not mind them taxing it; otherwise, keep their greasy hand out of my pocket. Yours too!

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