Foolish Revenge or Shrewd Regulation? Financial-Industry Tax Law Reforms Proposed in the Wake of the Financial Crisis
24 Pages Posted: 14 Dec 2010
Date Written: December 12, 2010
This Comment evaluates four recent proposals to reform tax laws affecting the financial industry. After introducing the proposals, the author provides a theoretical framework for evaluating them and then relies on this framework to explore the benefits and drawbacks of each. Ultimately, the author rejects two proposals that call for imposing financial-transactions taxes and argues that lawmakers should instead focus on plans to either (1) permit cost-of-equity tax deductions or (2) tax the debt held by major financial institutions.
Keywords: tax, law, regulation, reform, financial, bank, transactions, debt, DeFazio, Obama, crisis, responsibility, fee, leverage, TARP, G20, IMF, FSB
JEL Classification: E60, E61, E62, H20, H21, H23, H26, H25, K34, G32, G38, K22, L50, L51, M21
Suggested Citation: Suggested Citation