Wall Street threatens to leave New York if state reinstates financial transaction tax

The operator of the NYSE stock exchange platform opposes the reinstatement of this tax in a letter published on the website of the Wall Street Journal.

The operator of the NYSE stock exchange platform, whose famous floor south of Manhattan symbolizes Wall Street, threatens to leave New York if the state reintroduces a tax on financial transactions that was abolished several years ago.

“If elected officials choose to reinstate this tax, the NYSE (New York Stock-Exchange) will have to follow the example of firms that are relocating” out of state, writes Stacey Cunningham, the group’s president in a column published on Tuesday on the site of Wall Street Journal . The Covid-19 pandemic has emptied New York City of its financiers, who have been working remotely for several months. Many firms, like Goldman Sachs, have moved employees to other states where they have either strengthened their existing offices or opened new branches.

According to Stacey Cunningham, by neutralizing in 1981 the tax on financial transactions, in particular on the purchase of shares, the authorities of the State of New York had taken the “Good” decision. Restoring it would, according to her, “a madness”, especially since brokerage houses and other financial firms will transfer this additional cost to investors and small holders in particular. The leader also says that countries that have adopted such a tax, such as France in 2012 and Sweden in 1984, have seen part of the volumes of trade transferred to other stock exchanges, such as London.

Ways to get around

In addition, she argues, the expected benefits, namely generating additional tax revenue, will not be there. “In fact, the state risks collecting much less because firms could avoid paying this tax by using new technologies or by relocating part of their brokerage activity and other activities outside New York”, she warns.

Last week, nearly 30 New York-based financial firms wrote to Governor Andrew Cuomo protesting a bill on financial transaction taxation pushed, they say, by some elected Democrats and unions. , according to the American press. This debate comes at a time when the coffers of many states, including New York, are almost empty because their tax revenues have fallen due to bankruptcies and closures of companies affected by the pandemic.


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