The case against a financial transactions tax (web publication)

Why it won't work and will damage the economy

Executive summary

  • There is strong economic evidence that the proposed Financial Transactions Tax (FTT) would not increase the amount of tax revenue collected by governments. In fact it would reduce total tax revenue by shrinking the economy.
  • Workers and consumers in general - not the banks - would carry the main economic burden of the FTT. Wages would be lower because the tax would increase the cost of capital, thereby reducing growth in productivity.
  • Returns on pension funds and other savings would also be lower, in part because the FTT would increase the costs of buying and selling shares as we