Beautiful Virgin Islands

Tuesday, Jun 03, 2025

House Republicans move to block financial transaction tax as GameStop furor revives Dems' calls for penalty

House Republicans move to block financial transaction tax as GameStop furor revives Dems' calls for penalty

House Republicans on Wednesday unveiled a bill to block a financial transaction tax after the recent frenetic trading of GameStop shares revived a years-long effort by progressive Democrats to impose a penalty on stock trades.
The proposal, a copy of which was obtained by FOX Business, would prohibit states and municipalities from imposing taxes on transactions.

Rep. Patrick McHenry, R-N.C., the lead Republican on the House Financial Services Committee, and Rep. Bill Huizenga, R-Mich., reintroduced the Protecting Retirement Savers and Everyday Investors Act after Democrats seized onto the GameStop trading frenzy to make the case for a financial transaction tax.

During a House hearing last week to examine the GameStop furor, Rep. Maxine Waters, D-Calif., who chairs the Financial Services Committee, said she is considering such a tax, which is supported by progressive lawmakers, including Sens. Bernie Sanders, I-Vt., and Elizabeth Warren, D-Mass., as well as Reps. Ilhan Omar, D-Minn., and Alexandria Ocasio-Cortez, D-N.Y.

They see it as a way to reduce speculative betting that was behind last month's wild swings in the price of GameStop stock, which surged 1,000% in two weeks after an army of at-home traders put their support behind the stock, betting that share prices would rise even as Wall Street short-sellers gambled the exact opposite.

“A small tax – 0.1% – on each Wall Street trade would reduce high frequency trading, a practice which drains profits from retail investors and benefits only the very rich,” Omar tweeted during the GameStop furor. Omar previously introduced legislation with Sanders calling for taxes of 0.5% on stock trades, 0.1% on bonds and 0.0005% on derivatives.

But critics, including McHenry and Huizenga, say that a financial transaction tax could decrease trading activity, lower earnings and ultimately hurt the average American who's trying to save for retirement. The tax on stock trades is applied each time a financial transaction is conducted, which includes mutual funds – owned by roughly 45% of U.S. households – and pension plans.

“Democrats continue to ignore the facts by pushing a financial transaction tax," McHenry said in a statement. "They claim their state-level FTTs would only be paid by the wealthiest, but Americans saving for their futures across the country would end up footing the bill. These FTTs would penalize Americans saving for retirement, their first home, or their child’s education, all at a time when they can least afford it."

One study from the Securities Industry and Financial Markets Association (SIFMA), an industry trade group, found that a financial transaction tax would cause a “cascade of taxation that will accumulate during the standard operations of a mutual fund portfolio, resulting in significant reductions in overall returns.”

The average mutual fund investor would have to save an additional $600 per year – a 12% increase in savings – or work an additional two years to achieve her retirement goals, the group estimated. If the tax is more than 0.1%, that individual would have to save (or work) more. Investors in an active small-cap equity mutual fund would likely see returns shrink by an estimated 1.62% annually, according to SIFMA.

The GOP lawmakers also argued that it would violate President Biden's campaign promise to not raise taxes on Americans earning less than $400,000 annually.

"A financial transaction tax would clearly break President Biden’s promise to not raise taxes on middle-class families and would negatively impact retirement savers, pensioners, families saving for college, and everyday investors," Huizenga said. "If Washington wants to take a risk, it should try to do more with less by cutting federal spending, instead of taking more money away from Americans investing to build a brighter and more secure future.”

Imposing a 0.1% tax on stock, bond and derivative transactions would raise an estimated $777 billion over the next decade, according to a 2018 analysis by the nonpartisan Congressional Budget Office.

The nation's debt has been pushed to a record high due to massive amounts of coronavirus relief spending and is poised to hit $30 trillion this year once Democrats pass President Biden's $1.9 trillion stimulus package.
Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
China Accuses US of Violating Trade Truce
Panama Port Owner Balances US-China Pressures
France Implements Nationwide Outdoor Smoking Ban to Protect Children
German Chancellor Merz Keeps Putin Guessing on Missile Strategy
Mandelson Criticizes UK's 'Fetish' for Abandoning EU Regulations
British Fishing Boat Owner Fined €30,000 by French Authorities
Dutch government falls as far-right leader Wilders quits coalition
Harvard Urges US to Unfreeze Funds for Public Health Research
Businessman Mauled by Lion at Luxury Namibian Lodge
Researchers Consider New Destinations Beyond the U.S.
53-Year-Old Doctor Claims Biological Age of 23
Trump Struggles to Secure Trade Deals With China and Europe
Russia to Return 6,000 Corpses Under Ukraine Prisoner Swap Deal
Microsoft Lays Off Hundreds More Amid Restructuring
Harvey Weinstein’s Publicist Embraces Notoriety
Macron and Meloni Seek Unity Despite Tensions
Trump Administration Accused of Obstructing Deportation Cases
Newark Mayor Sues Over Arrest at Immigration Facility
Center-Left Candidate Projected to Win South Korean Presidency
Trump’s Tariffs Predicted to Stall Global Economic Growth
South Korea’s President-Elect Expected to Take Softer Line on Trump and North Korea
Trump’s China Strategy Remains a Geopolitical Puzzle
Ukraine Executes Long-Range Drone Strikes on Russian Airbases
Conservative Karol Nawrocki wins Poland’s presidential election
Study Identifies Potential Radicalization Risk Among Over One Million Muslims in Germany
Good news: Annalena Baerbock Elected President of the UN General Assembly
Apple Appeals EU Law Over User Data Sharing Requirements
South Africa: "First Black Bank" Collapses after Being Looted by Owners
Poland will now withdraw from the EU migration pact after pro-Trump nationalist wins Election
"That's Disgusting, Don’t Say It Again": The Trump Joke That Made the President Boil
Trump Cancels NASA Nominee Over Democratic Donations
Paris Saint-Germain's Greatest Triumph Is Football’s Lowest Point
OnlyFans for Sale: From Lockdown Lifeline to Eight-Billion-Dollar Empire
Mayor’s Security Officer Implicated | Shocking New Details Emerge in NYC Kidnapping Case
Hegseth Warns of Potential Chinese Military Action Against Taiwan
OPEC+ Agrees to Increase Oil Output for Third Consecutive Month
Jamie Dimon Warns U.S. Bond Market Faces Pressure from Rising Debt
Turkey Detains Istanbul Officials Amid Anti-Corruption Crackdown
Taylor Swift Gains Ownership of Her First Six Albums
Bangkok Ranked World's Top City for Remote Work in 2025
Satirical Sketch Sparks Political Spouse Feud in South Korea
Indonesia Quarry Collapse Leaves Multiple Dead and Missing
South Korean Election Video Pulled Amid Misogyny Outcry
Asian Economies Shift Away from US Dollar Amid Trade Tensions
Netflix Investigates Allegations of On-Set Mistreatment in K-Drama Production
US Defence Chief Reaffirms Strong Ties with Singapore Amid Regional Tensions
Vietnam Faces Strategic Dilemma Over China's Mekong River Projects
Malaysia's First AI Preacher Sparks Debate on Islamic Principles
White House Press Secretary Criticizes Harvard Funding, Advocates for Vocational Training
France to Implement Nationwide Smoking Ban in Outdoor Spaces Frequented by Children
×