There is a growing consensus: The stock transfer tax under consideration by the New York State Legislature would be a disaster. An end to New York City as we know it, because passing it would force every bank and hedge fund and financial services player to up and move to Palm Beach or Houston, permanently immiserating the capital of global capitalism. Everyone says this: the Atlanta-based New York Stock Exchange, the nominally Democratic governor’s nominally Democratic tax commissioner and, through its membership in the Securities Industry and Financial Markets Association, Goldman Sachs.
Why, let’s hear from Goldman itself on stock-transfer taxes:
Hong Kong’s tax hike on share trading was a “convenient catalyst” that helped spur a healthy correction for the city’s markets, says Tim Moe from Goldman Sachs…. “I think it’s important to note that the overall increase, I mean yes it sounds like 30%’s a big number, but it’s really 3 cents on every hundred dollars of trading — that’s hardly gonna be the only or sufficient fundamental reason for people to make an investment decision,” said Moe, co-head of Asia macro-research and chief Asia-Pacific equity strategist at the U.S. investment bank.
For what it’s worth, the New York rate on stocks over $20 would be about twice the new Hong Kong rate of 0.13%, with the important caveat that at a maximum of $350 per stock per day, for more large-scale operations the effective rate is likely to be much lower. Never mind: What’s “hardly a sufficient fundamental reason” in Goldman’s eyes 8,000 miles from Wall Street is an existential threat to that thoroughfare from Albany.
Hong Kong’s trading tax hike spurred markets into a ‘healthy correction,’ says Goldman Sachs [CNBC]
Stock Transfer Tax Gains Traction in New York Budget Debate [Bloomberg Tax]
New York Tax Commissioner Rejects Proposal for Stock-Transfer Levy [WSJ]