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Trade Transaction Tax - The Death Of All Us!

  • #41
  • Dec 22, 2009 5:47am Dec 22, 2009 5:47am
Quoting daytrading
Hi,

On what grounds do you think that all traders, specifically private persons will require a qualification/license to engage in the fin. markets?

If the government only want the 'big players' in the market, who were the players that contributed to the recent financial problems (as far as I know, there were hardly any retail traders involved in CDO's and other sub-prime speculation)?

I am not sure about the US, but here in the UK it is not quite possible to 'dodge' taxes by changing your residential status - in fact, changing your residential...
You shouldnt believe all you read in the press, no currency traders were responsible for the global financial problems. Basically a few bankers made some serious miss-judgements etc.

Its actually very easy to avoid tax when it comes to forex income. I work for a large banks trading floor who have a tax/account dept that can find loopholes in just about anything.

The UK government has brought in some tax changes to bonuses which is resulting in allot of traders being relocated to Switzerland, Hong Kong, Singapore and elsewhere. Over the next 18 months or so the city of London will also become very different with many firms leaving etc.

Its very hard to see where the UK's future tax revenues will come from!.

Scoobs.
  • #42
  • Edited 6:09am Dec 22, 2009 5:53am | Edited 6:09am
Scoobs, with all due respect, you could put it in your signature, you mention it in almost every post of yours. Would save some typing.

"I work on the trading floor of HSBC in London"

Or even better, put it next to your nickname, see, there's "Lucky fool" for me.

To the subject, I'll consider DJ, SnP etc. indexes or CFDs if this tax kicks in - if you survive good old forex for a while, chances are you can adapt to those indexes too. I follow Dow and a couple others anyway.

Quoting scooby-doo
You shouldnt believe all you read in the press, no currency traders were responsible for the global financial problems. Basically a few bankers made some serious miss-judgements etc.

Its actually very easy to avoid tax when it comes to forex income. I work for a large banks trading floor who have a tax/account dept that can find loopholes in just about anything.

The UK government has brought in some tax changes to bonuses which is resulting in allot of traders being relocated to Switzerland, Hong Kong, Singapore and elsewhere. Over the...
forget about tomorrow, just steal away into the night
  • #43
  • Dec 22, 2009 6:09am Dec 22, 2009 6:09am
Quoting scooby-doo
You shouldnt believe all you read in the press, no currency traders were responsible for the global financial problems. Basically a few bankers made some serious miss-judgements etc.

Its actually very easy to avoid tax when it comes to forex income. I work for a large banks trading floor who have a tax/account dept that can find loopholes in just about anything.

The UK government has brought in some tax changes to bonuses which is resulting in allot of traders being relocated to Switzerland, Hong Kong, Singapore and elsewhere. Over...
Firstly, I do not believe everything that comes printed - on the contrary - although, I am not quite sure what that has to do with my question.

You have made some quite certain statements and I am simply wondering on what grounds you draw those conclusions? I believe that I am quite well informed when it comes to taxation (in the UK and Europe) since I have been working in the industry for more than 2 decades in 4 different countries. That includes working for investment houses, brokerages, proprietary firms and funds.

Your assumption that retail traders can at will relocate to tax friendlier countries might be correct - albeit quite unlikely for most for the simple reason that the majority in this business does not generate enough income to be able to afford it.

The group of people you speak about (traders from firms like Brevan Howard or Blue Crest who I have known for over 10 years) are not your typical retail traders. They earn so far above the average that they can hardly be taken as an example for the majority of participants who would be effected by any proposed fin. transaction tax.

Another part of the story is that not a single private HF has been bailed out by any government. Neither have any retail traders. The only group of traders who have been actively rescued were banks. So why would 'the US and others' as you put it, 'not like retail traders'?

Retail traders amount for quite a piece of the total trading pie - which in turn is part of the equation on which the normative economists base their revenue calculations for the suggested transaction tax. Without that portion, the whole idea looks quite different.

regards
daytrading
Enter Signature
  • #44
  • Dec 22, 2009 6:40am Dec 22, 2009 6:40am
Quoting daytrading
Firstly, I do not believe everything that comes printed - on the contrary - although, I am not quite sure what that has to do with my question.

You have made some quite certain statements and I am simply wondering on what grounds you draw those conclusions? I believe that I am quite well informed when it comes to taxation (in the UK and Europe) since I have been working in the industry for more than 2 decades in 4 different countries. That includes working for investment houses, brokerages, proprietary firms and funds.

Your assumption that...
All i was trying to say is that the 'transaction' tax will come at some point in the not too distant future.

I personally know many traders who move every 3 months or so to hide their tax status, some of who are very big players. If you take the US then the NFA has no desire for small retail traders and they will bring in further legislation to make it impossible for them to operate.

Scoobs.
  • #45
  • Dec 22, 2009 6:42am Dec 22, 2009 6:42am
Ok, gotcha.

regards
daytrading
Enter Signature
  • #46
  • Dec 22, 2009 11:44am Dec 22, 2009 11:44am
Quoting FinnTrader
One more funny thing the supportes of the tax declare is that "the currency markets being worth 2 trillion a day, the tax would produce 0.25% of that amount a day." LOL. Aren't they just making the currency markets about 90% smaller, so a bit too optimistic tax expectations.
Now I have the piece in my mind again. LOL. The odds for this tax becoming global in the next ten years seem to be very, very low.
Happy trading and Merry Christmas! http://www.forexfactory.com/images/s...rn/biggrin.gif
Finn
The EU would be better off running a bucket shop and spending money on marketing. Make more off the spread than a tax, I hope they aren't reading this...
Don't wish it were easier, wish you were better. ~ Jim Rohn
  • #47
  • Dec 22, 2009 12:05pm Dec 22, 2009 12:05pm
Open a biz and get creative with writeoffs
ok Friendo? This is madness!?!? - THIS, IS, FOREX!!!
  • #48
  • Dec 22, 2009 12:29pm Dec 22, 2009 12:29pm
Quoting pip pirate 2
Maybe the solution will be to open accounts in the U.K., and then we can pay taxes on the money as it comes back to the US by wire, and just pay taxes as income. Forex taxes are going up anyway as Obama wants to raise the capital gains taxes, since we are taxed at 60% cap gains and 40% ordinary income.

If that's gonna be possible then the tax won't even happen in the first place. No country just wants to piss away business to others like that. Either it's a global tax with the UK, USA and the other big powers on board an it's unavoidable or it's not happening. It's gonna be difficult for them to do, but if they don't it that's it, it won't be undone.
  • #49
  • Dec 22, 2009 12:37pm Dec 22, 2009 12:37pm
Quoting Chocol8Elvis
well the leverage would just have to be less, and even after that your left with coins, not dollars.

but the world is just becoming a cess pool of taxes. as goverments grow there are less MONEY PRODUCING industries to create the funds to keep the governments cashed up....

we are all just stock to governments, the more people the more stock. more stock more dividends. more government OH YEAH lets lock a guy up in jail coz he was smoking 1/2 a gram of green in his house, they just do the DUMBEST of things with taxes, for the given example how...
Speaking of the government spending thousands of $$$ of tax money on locking people up for smoking 'green' did you see that article where the UN reckons that drug money stopped the banks from collapsing during the financial crisis last year? http://www.nzherald.co.nz/small-busi...ectid=10616309 Looks like lots of drug money got into the banking system when they most needed to capitalise the banks and save the banking system. I know it sounds odd, but maybe taxing drug would be better than a Forex trading tax? It would certainly be fairer to take money off them anyway. Because drug users often mess themselves up and society (at least in the UK anyway) has to help repair the damage with services like medical care and rehab and such like.

Anyway, where did you move to that has almost no tax? The UAE?
  • #50
  • Edited 7:22am Dec 23, 2009 7:16am | Edited 7:22am
Quoting Davidee

Anyway, where did you move to that has almost no tax? The UAE?

It's not fer everyone, but it's great fun!!!!
Macau.

i still cringe when i think about paying $5 for a beer at home, (Australia)
whn i pay just over $1USD for the same beer here.
now where does the other $4 go?

well if they still push for it and when there is such a huge wad of cash inthe market, and the financial hubs still refuse to join the party, i would not be surprised if they created a system where we had to have some sort of GLOBAL tax file number. of something down those lines. but if i still have to pay this tax i will be sending the recipts to my home country's tax system to get tax credits.
now that will piss all the nations off!!! global traders getting away with not paying tax in thier home countries.......

geeeezzz we may as well start talking about nostrodamus about how the world will be a global goeverment and all that who ha....

TAXES! NO THANKS!
if i used every commercial EA i would be a brazilianare by next week!!!!
  • #51
  • Dec 23, 2009 11:46am Dec 23, 2009 11:46am
One thing came my mind. When you trade with bucketshop type of brokers, who always take the other side of the trade, then there isn't any transaction of different currencies, am I right? We basically just "gamble" against the broker, not in the real market.

So the tax would have no influence when trading with bucketshop brokers?
  • #52
  • Dec 23, 2009 12:04pm Dec 23, 2009 12:04pm
Quoting FinnTrader
One thing came my mind. When you trade with bucketshop type of brokers, who always take the other side of the trade, then there isn't any transaction of different currencies, am I right? We basically just "gamble" against the broker, not in the real market.

So the tax would have no influence when trading with bucketshop brokers?
I thought about this yesterday too, and concluded that you are right. Unless the tax rules are extended, bucket shops will not be affected by such a tax. Nevertheless, due to lower liquidity, spreads will widen.

Bucket shops are like a betting place, and might be regulated in other ways. Also, since bucketshops hate consistently profitable traders, its not the ideal place for a good trader to stash his trading money, don't you agree? I read a book once, I think it was by Jesse Livermore, who was banned from about every bucketshop in Northern America.
The nail that sticks out gets hammered back in
  • #53
  • Dec 23, 2009 3:04pm Dec 23, 2009 3:04pm
Quoting Noloqy

Bucket shops are like a betting place, and might be regulated in other ways. Also, since bucketshops hate consistently profitable traders, its not the ideal place for a good trader to stash his trading money, don't you agree? I read a book once, I think it was by Jesse Livermore, who was banned from about every bucketshop in Northern America.
Sure they want rather bad traders as their clients, but since 95% lose they will get nice profit even when 5% of their clients are winning lots of money. But yes, not an ideal place for a talented trader, but it's good to know there's this possibility, if this tax some day becomes true, so trading won't be over.
  • #54
  • Dec 24, 2009 2:00am Dec 24, 2009 2:00am
Quoting FinnTrader
One thing came my mind. When you trade with bucketshop type of brokers, who always take the other side of the trade, then there isn't any transaction of different currencies, am I right? We basically just "gamble" against the broker, not in the real market.

So the tax would have no influence when trading with bucketshop brokers?
YAY !!!
this is intresting, and it makes good common sense, (which is NOT so common)

however i would not be surprised if the bucket shops still used it as another hook on thier line to produce record revenues..
if i used every commercial EA i would be a brazilianare by next week!!!!
  • #55
  • Dec 24, 2009 4:15pm Dec 24, 2009 4:15pm
What if banks go on strike? Is that possible? Does anyone know of other times when this has happened?

Imagina the news coverage if the entire trading floor on NYSE was empty monday morning and they were all outside...

Lols
ok Friendo? This is madness!?!? - THIS, IS, FOREX!!!
  • #56
  • Dec 24, 2009 7:16pm Dec 24, 2009 7:16pm
Quoting Liger86
What if banks go on strike? Is that possible? Does anyone know of other times when this has happened?

Imagina the news coverage if the entire trading floor on NYSE was empty monday morning and they were all outside...

Lols
Do a search on Bank Holiday and no it's not when they close for Christmas.
Don't wish it were easier, wish you were better. ~ Jim Rohn
  • #57
  • Dec 25, 2009 12:20pm Dec 25, 2009 12:20pm
Quoting FinnTrader
One thing came my mind. When you trade with bucketshop type of brokers, who always take the other side of the trade, then there isn't any transaction of different currencies, am I right? We basically just "gamble" against the broker, not in the real market.

So the tax would have no influence when trading with bucketshop brokers?

The problem with that is those 'brokers' ban you if you consistently win more than you lose. Make no mistake, this tax was aimed at killing short term speculating, and it will.

The solution is to convince the powers that be that having a liquid market is worth the loss in tax revenue.
  • #58
  • Dec 25, 2009 12:40pm Dec 25, 2009 12:40pm
We are no longer citizens. We have become "revenue sources".
  • #59
  • Dec 25, 2009 2:23pm Dec 25, 2009 2:23pm
Quoting Davidee
The problem with that is those 'brokers' ban you if you consistently win more than you lose...
Small brokers might do that, but bigger ones can't afford that. It would kill their reputation, if they banned successful traders. I have never heard that anyone would have been banned from Oanda or Alpari UK for example.
  • #60
  • Dec 26, 2009 12:18am Dec 26, 2009 12:18am
The IMF have opened this up for debate, you can email them at [email protected] and tell them all of the consequences this tax.
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