Schatz, Hoyle Introduce Legislation To Tax Wall Street, Reduce Economic Inequality As Republicans Race To Cut Taxes For Billionaires, Corporations

WASHINGTON – U.S. Senator Brian Schatz (D-Hawai‘i) reintroduced legislation to create a new progressive tax on financial transactions that would curb high-risk trading practices, reduce economic inequality, and generate $752 billion in new federal revenue over ten years once phased in. The bill comes as congressional Republicans advance a plan to cut taxes for billionaires and corporations by kicking more than 16 million Americans off of health insurance, raising health care and energy costs, slashing nutritional assistance, and ballooning the deficit.

“Wall Street routinely cashes in on high-risk trades that add no real value to our economy. It’s long past time we curbed this dangerous trading to reduce market volatility and encourage investment that actually helps our economy grow,” said Senator Schatz. “Republicans are racing to enrich billionaires and corporations by ripping regular people off. We’re doing the opposite: raising new revenue from Wall Street to reinvest in our communities.”

The legislation is cosponsored by U.S. Senators Elizabeth Warren (D-Mass.), Chris Van Hollen (D-Md.), Sheldon Whitehouse (D-R.I.), John Fetterman (D-Pa.), and Jeff Merkley (D-Ore.). U.S. Representative Val Hoyle (D-Ore.) introduced a companion bill in the House of Representatives.

“While Republicans push another tax break for billionaires that would blow up the deficit, we’re offering a smarter path. The Wall Street Tax Act puts a price on the risky, high-speed trading that benefits Wall Street and leaves working families behind,” said Representative Hoyle. “This small, targeted tax will raise hundreds of billions from those who can afford it and reinvest it in things that actually help people—like schools, housing, and infrastructure. Working families shouldn’t have to pay for Wall Street’s gambling.”

High-volume, speculative trading is part of the disconnect between the financial system and the real economy, as it adds no real economic value and disproportionately benefits those at the top. The overwhelming majority of stocks are owned by the wealthiest Americans, who have reaped massive profits from trading on Wall Street. The result has been an uneven economic recovery: while workers have lost their jobs, fallen behind on rent, and lacked enough food for their families, as of the end of last year, America’s 728 billionaires have seen their wealth grow by more than $1.5 trillion since 2020.

The Wall Street Tax Act would create, and phase in over 5 years, a 0.1% tax on each sale of stocks, bonds, and derivatives, which will discourage unproductive trading and redirect investment toward more productive areas of the economy. The new tax would apply to the fair market value of equities and bonds, and the payment flows under derivatives contracts. Initial public offerings and short-term debt would be exempted.

The full text of the bill is available here.

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