International Financial Flows and Transactions Taxes: Survey and Options

Spahn, Paul Bernd

doi:10.5089/9781451847994.001

Cited by 35 publications

(26 citation statements)

References 26 publications

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“…Ultimately, the capital supply to corporations and therefore the economy will be limited impeding overall economy development. Spahn (1995) also denies the viability of a transaction tax in foreign exchange trading as a tax would impair the financial market and create liquidity problems. Habermeier and Kirilenko (2001) strongly oppose the introduction of a STT.…”

Section: Theoretical Literaturementioning

confidence: 99%

Securities Transaction Tax and Market Quality – the Case of France

Gomber

Haferkorn

Zimmermann

2015

Euro Fin Management

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The French Securities Transaction Tax (STT) implementation on August 1 st , 2012, is considered a landmark development within securities markets regulation. However, until today the controversy about possible drawbacks and applicability has not reached a conclusion and consequences for market quality are yet to be thoroughly assessed. In this light a rigorous evaluation on the STT's effect on market quality is highly desirable and would provide guidance for academics, regulators and practitioners alike. On this basis, we provide evidence that trading activity declines by approximately 16% after the introduction of the STT. Even though the French proposal exempts liquidity providing activities, we find increased spread levels and a strong decline in top order book depth resulting in additional transaction costs for market participants beside the tax. Most alerting, as the STT affects trading on all French listing venues, we find this deterioration in market quality threatening inter-market information transmission by impairing price coordination among the European fragmented markets.

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Section: Theoretical Literaturementioning

confidence: 99%

Securities Transaction Tax and Market Quality – the Case of France

Gomber

Haferkorn

Zimmermann

2015

Euro Fin Management

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“…Regarding the level of the tax rate, (Spahn, 1995) suggested two tire rate system, specifi cally low-rate FTT and exchange surcharge at prohibitive rate. Further, (Mende and Menkhoff , 2003) underline that low Tobin's type tax will not eliminate speculation and a high tax rate will signifi cantly reduce liquidity.…”

Section: Theoretical Backgroundmentioning

confidence: 99%

Financial Transaction Tax: Determination of Economic Impact Under DSGE Model

Solilová¹,

Nerudová²

2015

Acta Univ. Agric. Silvic. Mendelianae Brun.

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The discussion about the possible taxation of the fi nancial sector has started in the European Union as a result of the fi nancial crisis which has spread to the Europe from the United States in 2008 and consequently of the massive fi nancial interventions by governments made in favour of the fi nancial sector. On 14 February 2013, a er rejection of the dra of the directive introducing a common system of fi nancial transaction tax in 2011, the European Commission introduced the fi nancial transaction tax through enhanced cooperation. The aim of the paper is to research economic impact of fi nancial transaction tax on EU (EU27 or EU11) with respect to the DSGE model which was used for the determination of impacts. Based on our analysis the DSGE model can be considered as underestimated in case of the impact on economic growth and an overestimated in case of the revenue collection. Particularly, the overall impact of the fi nancial transaction tax considering cascade eff ects of securities (tax rate 2.2%) and derivatives (tax rate 0.2%) is ranged between −4.752 and 1.472 percent points of GDP. And further, is assumed that the relocation eff ects of business/trade can be in average 40% causes a decline of expected tax revenues in the amount of 13bn EUR. Thus, at a time of fragile economic growth across the EU and the increased risk of recession in Europe, the introduction of the FTT should be undesirable.

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“…This could reduce the volume of very short term investments (including HFT), which might moderate the pro-cyclical herd effect. If a tax on all transactions were to significantly reduce liquidity and compromise efficiency, then a modified version of the tax might be needed, which would take effect during periods of volatility when exchange rates leave their pre-defined, normal ranges (Spahn, 1995). How much exactly a Tobin-type tax would limit volatility and bubbles is still subject to debate (Eichengreen et al, 1995;Davidson 1997;Scheinkman and Xiong, 2003).…”

Section: Potential Responsesmentioning

confidence: 99%

Macroeconomics, financial crisis and the environment: Strategies for a sustainability transition

Antal

Bergh

2013

Environmental Innovation and Societal Transitions

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in AbstractWe raise fundamental questions about macroeconomics relevant to escaping the financial and economic crisis and shifting to a sustainable economy. First, the feasibility of decoupling environmental pressure from aggregate income is considered. Decoupling as a single environmental strategy is found to be very risky. Next, three main arguments for economic growth are examined: growth as progress, growth to avoid economic instability, and growth to offset unemployment due to labour productivity improvements. For each, we offer orthodox, heterodox and new responses. Attention is paid to progress indicators, feedback mechanisms affecting business cycles, and strategies to limit unemployment without the need for growth. Besides offering an economy-wide angle, we discuss the role of housing and mortgage markets in economic cyclicality. Finally, interactions between real economic and financialmonetary spheres are studied. This includes money creation, capital allocation and trade-offs between efficiency and operating costs of financial systems. Throughout, environmental and transition implications are outlined. We raise fundamental questions about macroeconomics relevant to escaping the financial-economic crisis and shifting to a sustainable economy. First, the feasibility of decoupling environmental pressure from aggregate income is considered. Decoupling as a single environmental strategy is found to be very risky. Next, three main arguments for economic growth are examined: growth as progress, growth to avoid economic instability, and growth to offset unemployment due to labor productivity improvements. For each, we offer orthodox, heterodox and new responses. Attention is paid to progress indicators, feedback mechanisms affecting business cycles, and strategies to limit unemployment without the need for growth. Besides offering an economy-wide angle, we discuss the role of housing and mortgage markets in economic cyclicality. Finally, interactions between real economic and financial-monetary spheres are studied. This includes money creation, capital allocation and trade-offs between efficiency and operating costs of financial systems. Throughout, environmental and transition implications are outlined.JEL-Code: E32, E44, O44, Q01, Q43, Q54

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International Financial Flows and Transactions Taxes: Survey and Options

Cited by 35 publications

References 26 publications

Securities Transaction Tax and Market Quality – the Case of France

Securities Transaction Tax and Market Quality – the Case of France

Financial Transaction Tax: Determination of Economic Impact Under DSGE Model

Macroeconomics, financial crisis and the environment: Strategies for a sustainability transition

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