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I hope banks start jacking up overdraft charges, mortgage rates and other fees. That'll teach the bastards.
.05% of WHAT?
If it raises £100 Billion through a .05% tax that means the taxable amount is £200 Trillion. I think its fair to say that investment banks are not collectively making £200 Trillion per year, so this is obviously a .05% tax on the notional value of transactions.... maybe certain types of trades and/or deals.
I don't know how you can determine if the tax is ALOT without understanding what the taxable portion is.
A bank that is taking a 50 bps of notional fee (AKA .5%) and is paying a .05% of notional tax is paying an effective 10% of revenues tax. Take that 10% of revenues and get down to taxable income, and its very likely that this .05% could actually equate to 25% or more depending on the firms margins.
Take this example: $10 Billion dollar deal 50 bps fee, .05% Robin Hood tax Fees = $50 million; Tax = $5 million ETR on Fee = 10%
Take out operating expenses... not sure what that would come out to but Evercore has an operating margin of about 20%, excluding the Armageddon years.... that translates to an operating profit of $10 Million.... hit that with the boilerplate 37.5% income tax rate = $3.75 Million income tax. So $3.75 Million Income Tax + $5 Million Robin Hood Tax = Total Tax of $8.75 Million on an Operating Profit excluding Robin Hood Tax of $15 million... whats the ETR... 58.3%.
Thats very back of the envelope, but 58.3% - 37.5% = is an additional 20.8% tax. Not quite .05% as claimed, is it. In other words, an additional 1/5 tax... put another way, please leave all your profits in a green trash can one day a week and we'll come by to pick it up.
In case you're wondering... double the fee to 100 bps and its an effective 12.5% incremental tax.
robin hood = awesome
robin hood = awesome
i really hate that people are stupid enough to believe this crap. why isnt there a reporter interviewing the politicians supporting this tax to demonstrate that they are dumber than the "banker" in the video and they are really the ones full of crap.
not that i am claiming that banks didnt do fucked up things these past few years and got away with it; it seems like they did
but i hate the fact that random poor people have chosen wall street as a scapegoat because their scumbag politicians told them too
why dont the fuck over doctors; they're rich too. oh wait they are doing that already. who's next? lawyers?
I like how they claim it is a "small" tax...yet it somehow is going to raise £200 billion! Not exactly small then is it dickheads!
I despair at all the comments now about "yeah, every person in finance is a crook, let's kick them all out the country, then our life would be amazing, we could all live in a socialist utopia it would be great". I don't blame the public - I didn't really understand what 'bankers' did either until my first internship - but it is a sad state of affairs when so many people are actively willing our dear, honest, ethical, selfless politicians to cut off the economy's nose to spite its face.
USA! USA!
I don't think we're this crazy to let something like this even receive consideration.
Quam numquam nihil blanditiis architecto assumenda. Omnis itaque et laudantium ducimus. Non ipsam sit est voluptatum odit. Corporis dignissimos voluptas aperiam. Qui doloremque vero similique fuga eaque ut illo fuga.
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