110 HR 7125 IH: Let Wall Street Pay for Wall U.S. House of Representatives 2008-09-26 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.

I 110th CONGRESS 2d Session H. R. 7125 IN THE HOUSE OF REPRESENTATIVES September 26, 2008 Mr. DeFazio (for himself, Mr. Stark, Mr. George Miller of California, Ms. Slaughter, Mr. Lewis of Georgia, Mr. Hinchey, Mr. Holt, Mr. Scott of Virginia, Mr. Abercrombie, Mr. Capuano, Mr. McDermott, Mr. Sires, Ms. Woolsey, Ms. Lee, Ms. Edwards of Maryland, Mr. Wu, Mr. Kucinich, Ms. Hirono, Mr. Melancon, Mr. Chandler, Mr. Welch of Vermont, Ms. Kaptur, Mr. Filner, Ms. Watson, Mr. Johnson of Georgia, Ms. Roybal-Allard, Mr. Costello, and Ms. Waters) introduced the following bill; which was referred to the Committee on Ways and Means A BILL To amend the Internal Revenue Code of 1986 to impose a tax on securities transactions.

1.

Short title; findings

(a)

Short title

This Act may be cited as the Let Wall Street Pay for Wall Street’s Illiquid Assets Act of 2008. (b)

Findings

Congress finds the following: (1)The Bush Administration is asking Congress to authorize $700 billion to cover the “illiquid” assets of Wall Street. This will further worsen our budget deficit. (2)The $700 billion is to protect Wall Street investors; therefore, the same Wall Street investors should pay for this infusion of taxpayer money. (3)The easiest method to raise the $700 billion from Wall Street is a securities transfer tax, a tax that has a negligible impact on the average investor. (4)This transfer tax would be on the sale and purchase of financial instruments such as stock, options, and futures. A quarter percent (0.25%) tax on financial transactions could raise approximately $150 billion a year. (5)The United States had a transfer tax from 1914 to 1966. The Revenue Act of 1914 levied a 0.2% tax on all sales or transfers of stock. In 1932, Congress more than doubled the tax to help overcome the budgetary challenges during the Great Depression. (6)The United Kingdom currently has a modest financial transaction tax of 0.5 percent. (7)The Securities and Exchange Commission currently implements a very small tax per transaction to cover its costs; therefore this additional transfer tax is easy to implement. (8)All revenue generated by this transfer tax shall be directed to the general treasury.

2.

Tax on securities transactions

(a)

In general

Chapter 36 of the Internal Revenue Code of 1986 is amended by inserting after subchapter B the following new subchapter: C

Tax on securities transactions

Sec. 4475. Tax on securities transactions.

4475.

Tax on securities transactions

(a)

Imposition of tax

There is hereby imposed a tax on each covered securities transaction of 0.25 percent of the value of the instruments involved in such transaction. (b)

By whom paid

The tax imposed by this section shall be paid by the trading facility on which the transaction occurs. (c)

Covered securities transaction

The term covered securities transaction means— (1)any transaction to which subsection (b), (c), or (d) of section 31 of the Securities Exchange Act of 1934 applies, and (2)any transaction subject to the exclusive jurisdiction of the Commodity Futures Trading Commission. (d)

Administration

The Secretary shall carry out this section in consultation with the Securities and Exchange Commission and the Commodity Futures Trading Commission.

. (b)

Clerical amendment

The table of subchapters for chapter 36 of such Code is amended by inserting after the item relating to subchapter B the following new item: Subchapter C. Tax on securities transactions. . (c)

Effective date

The amendments made by this section shall apply to transactions occurring on or after January 1, 2009.