Financial Transactions Tax

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All organizations engaging in financial transactions that exceed a set amount per annum should attract a tax on EVERY transaction (including the ones below the threshold).  This kind of tax has already been established in multiple European countries and there is a group of European Union countries attempting to have it implemented across Europe.  The aim there is to force financial institutions to repay the taxpayer’s bailout money they received as well as provide a solid contribution to government funding generally.[1]  This is meeting a lot of resistance from the financial industry of course and the start date of the Europe wide program has been delayed.[2]

This small businesses and individuals are will never need to pay this tax.  This tax is aimed at:

  1. Financial organizations that use high frequency trading and other large scale capital movements to generate profits on the international market.
    1. This tax is payable by any organization moving large amounts of money around for any purpose.
  2. Foreign investors of any kind that seek to take money out of Australia.
    1. This tax would be payable by ANY organization moving money into or out of Australia for any reason.

Punishments for attempting to avoid this tax should follow the same logic as the new white collar crimes, attracting a progressively higher fine calculated as a percentage of total revenue; that increases with each successive offence to provide an effective deterrent.

The revenue captured by this tax would be directed to fund the new industry ombudsman regulation program and to support the expected extra load this new regulation will place on the legal system for the first decade of operation.  Any excess should result in either greater health and education services or a reduction to individual income tax rates.  This tax could capture $10 billion a year in Australia.[3]

 

[1] http://ec.europa.eu/taxation_customs/taxation/other_taxes/financial_sector/index_en.htm

[2] http://www.eubusiness.com/news-eu/france-economy-tax.twr

[3] http://www.jubileeaustralia.org/page/work/ft-tax


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