Its about time! At least they are showing a little initiative. The plan -- which is unlikely to pass with Republicans in control of both chambers of Congress -- includes a host of tax perks for the middle class. The proposal would establish a new $1,000 tax credit for each worker, significantly expand the tax credit for childcare and expand tax deductions for families with two earners. Van Hollen said that under the plan, a two-income family with one child making a total of $80,000 a year would receive an additional $4,400 a year. The plan also includes a savers bonus, which would grant an additional $250 to anyone who saves at least $500 of their new paycheck tax break. But its Van Hollens push for a financial transactions tax to pay for much of the plan that marks the biggest shift in Democratic policy priorities. Van Hollen and his Democratic colleagues in the House are proposing a 0.1 percent tax on Wall Street trades of stocks and derivatives -- not enough to significantly change the economics of any particular deal, but enough to create a small cost for purely speculative activity. The sheer volume of financial trading makes a transactions tax a powerful revenue-generating tool for lawmakers, good for at least tens of billions of dollars a year, depending on how the tax is structured. Financial reform advocates have been pushing for a similar tax for years, but have been stymied by Wall Street lobbyists and the Obama administration. The U.S. already applies a tax of less than 0.1 percent on stock trades to fund the Securities and Exchange Commission. The U.K. imposes a similar 0.5 percent tax on stock trades that take place over the London Stock Exchange. Van Hollen noted that he is paying attention to a more comprehensive tax currently being developed by European authorities that would cover far more trades, including derivatives transactions. The Obama administration has long opposed a financial transactions tax. In his memoir Stress Test, Geithner ridicules reformers who pushed for the tax and says he worked to undercut global efforts to establish one. In April 2013, Lew called a transactions tax very problematic.
Posted on: Tue, 13 Jan 2015 05:33:45 +0000
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