Tobin Tax Effect on Forex

you forgot one trade includes buying $100000 and selling $100000 so that would make $20 tax alone per trade, add commissions (real ECN broker) and the spread you soon will pay $40 to $50 on average for a single trade

the funny thing is they truely believe that this tax will bring them a yearly revenue of about 50 billion Euros...this number is based on the fact that all private and commercial trading folks will continue trading the same way and dutifully agree to pay this tax

As long as you are not trading with a virtual marketmaker shithole (there are alternatives for retailers with smaller pockets too) spot forex is spot forex and not a derivative. Chance is if your broker is not your counterparty that you are not trading a derivative ( but it could be - read your tos).

Your calculation is right. 0.01% would be (100k usd lot) $100.000 * 0.01 / 100 = $10 * roundturn (2) = $20 with a pipvalue of $10 per 100k standard lot that makes 2 pips per roundturn trade as tax. It's the same what people don't realize most of the time when they talk about not caring about that 0.5-1pip (broker fraud) slippage. Go back in your trade list, add it up in addition to your (padded) spread and multiply with your pipvalue and see how much % that is compared to your overall gains. You might be surprised + always remember it goes against you double in combination with loosing trades.

But yes the spread probably won't be your biggest concern if you are not scalping in the <5 pip range. The bigger concern is the overall change in liquidity / spreads in the market if / once this hits for forex spot trading.

That's what everyone should be concerned about. HFT is meaningless money printing yes but it does the same that many small retailers do for a retail exchange - provide small but hell of a lot liquidity at pretty much any price point. This in return is positive on any price liquidity + spread.

They know fully well it won't pay shit. Just political nonsense but the average dumb as shit 99er likes that kinda populistic stuff and that is the biggest voter base so...

the game is getting harder...will futures be afeected?

the game is hard enough already

futures is a derivate too

what about spread betting? isn't it marked as "gambling"

Yes at the moment.

Yes maybe spread betting will be my solution.
Did you Guys know if a german student can open an spread betting accound without regular income?

spread betting is gambling so it should not be taxed.

What are the disadvantages of spread betting?

Thanks for your reply.

Tobin tax will not be passed through because the world largest lobbies are fighting this regulation. The UK said it will not impose any tax on financial transactions like the Tobin by that other big financial areas can't introduce them. If NY would impose such a tax all banks and funds there would move to a better place. My advice is not to worry about this since you guys are just crumbs in the financial market place, and if it happens a lot of people will find another smart way to attract the retail crowd because they generate billions in revenues a year.

Cheers

I've read this one here and there but never understood why a broker that uses Metatrader as a platform is a bucketshop? I've seen a number of brokers that use their own platforms all of them web based but none ever managed to convince me like the client program MT in terms of user friendliness. So I stuck with my current broker but I'm wondering whether I shouldn't consider a change if the difference to a non-MT using (i.e. good broker) is that big.

That's the case for the UK. In Germany it is not. You have to pay capital gains tax as part of your personal income declaration.

Do you mean it would be possible to start a one-man company in Switzerland to circumvent the tax?

"Deutschland wird indes versuchen, die von der Bundesregierung seit langem favorisierte Finanztransaktionssteuer durchzusetzen. Nachdem sich Regierung und Opposition geeinigt haben, lässt Finanzminister Wolfgang Schäuble nun konkrete Pläne für die Abgabe ausarbeiten, berichtet der Spiegel. Demnach soll die neue Steuer nur für Verkäufe von Aktien und solche Derivate gelten, bei denen die Aktien tatsächlich auch physisch den Besitzer wechseln.

Da zunächst ein neues elektronisches Erfassungssystem für den Handel installiert werden muss, können nach Einschätzung der Bundesregierung frühestens 2015 Einnahmen aus der geplanten Steuer fließen. Das Finanzministerium rechnet mit einem jährlichen Aufkommen von etwa zwei Milliarden Euro in Deutschland. Der Steuersatz von 0,1 Prozent auf den Kaufpreis soll sowohl für den Käufer wie auch für den Verkäufer fällig werden."

sorry, too lazy to translate into english, but that sounds like good news for german forex traders, as there is now way for them to have access to foreign brokers data, also 2015 is far away..i might be broke then

So now they decided to do it, who knows if it afffect Forex.

They are effectively convincing the "people" of Europe, the Banks are guilty of the crisis.
Sure!!! cause politicians didn´t make those horrendous credits nobody will ever pay....they just manifested by some miracle.

I think Einstein said something like: "one should not expect a solution from the people that created the problem in the first place."

That´s like saying: don´t expect common sense from an idiot.

You cannot pay zero taxes on spread betting in the UK if it is your sole income. If your income is less than your spreadbetting income then it you may be liable to pay taxes on your spreadbetting as well. I am not tax expert so you would need to read up and ask a financial advisor or tax solicitor about this. If you trade spot forex you pay income tax, not capital gains tax. I am pretty sure on this, although might be best asking your accountant.

How volatility may be increased if tobin tax is enforced.
http://www.anderson.ucla.edu/faculty...dhry/tobin.pdf

It is not as simple as saying Banks are solely responsible. They are and they are not. It is rather more complex. I know when the economy was booming that few people believed the quiet voices of contrarian economists saying the property market would severely collapse, just as it had done in the past. I thought it might be possible but like everyone else found it a difficult time to believe it, when we consider costs of living and the amount of times we live beyond our means because what starts out as a credit card or a loan we then get more and more of them and become more indebted as we build up a great credit rating, an easy way to rip off the banks if you have such ethics or fraudulent ways. We become more more irresponsible. I know I dislike how much income banks make from charging interest on money that does not exist, or rather is money created from debt itself and with added interest, making it impossible to repay because no way near as much honest, legitimate money made from true profits of market driven economies of supply and demand no longer exists. Instead we have balloon driven economies, how fast and how far can we inflate it with inflation and rises in cost of living and more debt! It becomes insane, and must change if we truly want economies that are sustainable and not in cyclic style of boom and bust every 6-12 years. Each time it happnes it becomes harder to recover from. How the USA benefited from low taxes and little legislation and a great foundation of constitutional law, this is something the world needs to look at, how they founded the greatest economy in the world in 2 or so centuries or less. And how the rest of the world has still not matched it.

Do you think they could get away with an EU wide Tobin Tax?

They wanted an EU wide tax so no one in the EU can escape it even if the Brokerage is outside of the EU then we would still be taxed, as would banks that had transactions with the EU. So effectively the EU is dictating to the whole planet a global tax. Similar as the airline CO2 tax with the USA?... I think. China said no way to that. It is powerful enough country to say we won't trade with you if you like to try and enforce it.

As this issue of sovereign laws exists in the EU with member nation-states, Germany found the Lisbon Treaty to not be in violation of sovereign constitutional law (how is that possible!!!) when it is worse than EU Constitution in many ways and virtually unreadable, not only did they have to force it through without any refedna because there was no way all sovereign countries would vote for it under a referndum, instead in the UK we were told by our PM that the UK government would simply hold as many refendums as it took until they got the aswer they wanted, (more democratic at least and the people here would still always say NO!!!) this was not what some nations wanted because it would cause problems to and stall law making process for years more than the EU already does. I remember though that Germany took the issue to the constitutional court because of their concerns and the court ruled in favour of the Lisbon Treaty, that it did not not affect their sovereignty, but still no referendem for the 400 million plus people. I find it very difficult to believe it was an honest ruling by the Germany constitutional court. Germany has a very strong constitution and with the UK constitutional lawyers saying it did violate our sovereign law codes....

David Cameron has strongly said no to a FTTax. And the EU made a suggestion that was initially inferred and then promoted support for this in some way of applying a direct tax to the UK, and there was uproar here in the UK among people with their opposition to this. With this in mind, do you honestly think a Tobin Tax could go ahead on an EU wide basis, not just in the Eurozone. I don't see how it can happen, the Lisbon treaty already allows a process for the UK to leave the EU and this issue would be even more strongly enforced at the next general election, many backbencher tories still calling for an in out refernedum on UK leaving the EU (this will NOT go away, not in ten or 200 years if the EU still exists by then), we have a trade deficit with the EU so have no reason to be in at all, despite what the deluded europhiles say or think with their 2 braincells, we trade with 85% of the world without them being an EU member. If Greece were to leave the Eurozone it would ensure the Euro was worth more making German exports rise in cost, meaning bad news for their trade balance, hence the opposition of Greece leaving and all the bailouts that only prolong the inevitble, if Germany left the Eurozone then the price would lower to reasonable and realistic levels of its true value. The only thing keeping the Euro at its high value is the German economy and economic rates and policies that governs its ECB policy making, based from the strongest EU economy. It doesn't suit all members and never can or will, not even with an EU central fiscal control. These are very inconvenient truthful, factual truths that are selectively ignored.

To conclude, they cannot do an EU wide taxation as it is totally undemocratic and against all sovereign law of the UK and no one could lawfully repeal laws to make it any other way so corruption and ignorance is popular to avoid any legal issues in our courts.

FTTax/Tobin Tax only for the Eurozone would mean business as usual in London and = the whole world because over 1/3 of deriatives trading volume is London based because we do not enforce stricter limits on the extent of their products or trading. It seems if we follow the obvious common sense of this situation it cannot be done either way. The EU is clutching at straws at saving the eurozone and has no real solutions, but is doing fairly well at fooling the markets, only for now. Their only answer is to hand more central power over to them, that is their solution.

[quote=Fxscalp;5984787]Do you think they could get away with an EU wide Tobin Tax?

the last I read, was Germany is working on some system/ software for Tobin collectionon stocks...should be ready in a couple of years...France already taxes, although much less than initially planned, (which was a Tobin on anything that moves.)
Apparently Forex would be close to impossible to tax for the moment, because of the complexity, being an international monster that nobody knows where it lives, how it really moves, and too big to mess with anyway...
My feel is that the German Government will bring out some Tobin tax to ease the pressure from the opposition, and please the crowds a little on the issue...

[quote=cuchuflito;5985710][quote=Fxscalp;5984787]Do you think they could get away with an EU wide Tobin Tax?

Tobin is back!
"Derivaten soll mit 0,01 Prozent pro Transaktion", from Der Spiegel today..
spot Forex is a derivative ( I think that´s the case..),
..then good bye trading Forex, starting 2014..meaning one more year to get rich and quit....
I don´t know exactly how many pips is 0,01 ( return), meaning when you enter, AND when you close!..
....but most likely the only chart left will be the weekly, or monthly...great if youré planning to live for another 200 years or so....

Stop being so negative.