Bernie Sanders Proposes Wall Street Tax And Free College

Bernie Sanders Proposes Wall Street Tax And Free College
New York #25 Matt Clark / Flickr CC BY 2.0

Bernie Sanders, the Senator from Vermont seeking the Democratic presidential nomination, has proposed a financial transactions tax (FTT), a Wall Street Sales tax. The revenue obtained will be used to make public colleges tuition-free.


The proposal for a FTT can be a real game-changer in reforming the financial sector. No other policy will impact the financial sector as much as an FTT will. It would impose a sales tax on the stocks and financial assets. Thereby, speculators will have to pay a tax on their trades.

An FTT, which could be proposed at different rates, can raise large sums of money. The following rate structure has been proposed by Sanders in a bill by Minneapolis Congressman Keith Ellison. In the European Union, eleven countries are working for the implementation of a set of FTTs that would tax the stock trades at a rate of around 0.1 percent.

According to a recent analysis of the European proposal, more than $130 billion a year or more than $1.5 trillion over the next decade can be raised by a comparable tax in the United States.

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Sanders suggested that the revenue that will be obtained from an FTT can be used in rebuilding infrastructure, paying college tuition or improving the healthcare system.

  • ftf123

    Bernie is out of touch with reality, but then it’s not his money. It’s ours. He can painlessly do what he wants with it. This tax on investments will result in negative revenue. This is the same Financial Transaction Tax as proposed in Europe. Here is what Europe has found:

    “The DCB study showed that 1.7 billion euros, over 42% of the annual FTT cost in the Netherlands, would be borne by pensions.”

    City of London Economic Research reporting on the household savings losses on three countries only, “Spain 16 percent household savings loss, Germany 14.1 percent household savings loss, Italy 12.3 percent household savings loss.”

    UK Parliament European Scrutiny Committee citing the EU Commission’s FTT Impact Assessment, “a 3.43% fall in EU GDP equates to a fall in economic output worth €421 (£362) billion and a 0.34% fall in employment equates to a loss of 812,000 jobs.”

    UK Parliament Economic Sub-Committee of the House of Lords, “The FTT is likely to induce a loss in GDP between five and 20 times larger than the revenues raised from the tax.”

    Bernie’s model country is Sweden. Citizens demanded an FTT to be enacted. The government could not in any way modify it to make it work. Sweden saw collection costs of the tax out-run the FTT’s own revenues. FTT revenues achieved 3 percent of revenue projections before subtracting reduced GDP revenue losses in all other areas. They increased FTT rates to 2 percent causing further revenue reduction. Sweden’s citizens demanded the tax to be abolished.