Should We Tax Financial Trades Like We Tax Alcohol?

Peter Wahl, a markets and financial regulation expert with Weed e.V. in Germany thinks there should be a financial transaction tax (FTT) that works the same way alcohol taxes work.

He says that governments have always experimented with the amount they tax alcohol; we should do the same with a transaction tax.

Alcohol taxes fluctuate based on sales.

The transaction tax should be a factor of liquidity. It should be increased and decreased depending on how much liquidity is in the market and how much is deemed necessary to maintain market health and robustness.

To start off, first, he suggests introducing a very low FTT. Then, depending on its effect on the market, adjusting it continuously (bi-annually or so) as liquidity changes.

Good thing it’s shockingly easy to skirt around the planned transaction tax. Peter thinks the Euro Zone is very close to forcing it into legislation.

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