Scarinci Hollenbeck, LLC
The Firm
201-896-4100 info@sh-law.comFirm Insights
Wall Street Reacts To Obama Tax Proposals
Author: Scarinci Hollenbeck, LLC
Date: February 5, 2015
Key Contacts
Back
Shortly after Pres. Barack Obama unveiled his latest tax proposal during the recent State of the Union Address, financial services industry participants, republican lawmakers and top lobbyist on Wall Street have all voiced their criticisms of the would-be policy.
The Securities Industry and Financial Markets Association contended that the new tax, which would place a seven-basis point levy on the liabilities of the largest banks, insurance firms and investment management companies in the U.S and Wall Street., is a superfluous attempt to manage industry risk and could undermine lending, according to Bloomberg.
Obama announced this new plan in his most recent SOTU address after floating a similar proposal last year, when he suggested imposing a tax on the liabilities of banks holding $50 billion in assets, the media outlet reported. The new plan, which would generate tax revenue that is estimated to be twice as high, would extend to asset managers and insurance firms and provide a lower tax rate than the original proposal.
SIFMA president and CEO Kenneth Bentsen weighed in on the policy in a statement released Jan. 18.
‘Unintended consequences’
“Tax rules are often blunt instruments, and the tax code is not the place for a broad, new and duplicative financial regulatory regime,” he said. “This $110 billion targeted tax increase on America’s most productive financial institutions could have far-reaching unintended consequences that will curtail economic growth and job creation while negatively impacting the allocation of credit and the provision of financial services to individuals and institutions.”
He was not the only industry representative who spoke out against the proposal, as James Ballentine, chief lobbyist at trade organization the American Bankers Association, emphasized the challenges the new tax could create for the financial services industry, according to The Financial Times.
‘Difficult time’
“This really comes at a difficult time for an industry that is moving the economy forward,” he said, the media outlet reported. “To impose a fee, a flat tax, is certainly not warranted, and I hope Congress will reject this idea.”
Bentson also asserted that the proposed change was coming at a bad time and that it appeared oblivious to all the changes that lawmakers and regulators have made since 2009, according to Bloomberg. While he emphasized that government officials have been working on changing the regulatory environment for years, democrats in congress have been playing tug of war with industry as its representatives make an effort to take the bite out of the Dodd-Frank Act.
These struggles could experience key shifts after the republicans managed to enjoy key victories in both the House and Senate. These conservative lawmakers are not likely to approve another tax hike, as they have argued that such efforts hold back economic growth, according to The Financial Times.
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Does Your Homeowners Insurance Provide Adequate Coverage?
Your home is likely your greatest asset, which is why it is so important to adequately protect it. Homeowners insurance protects you from the financial costs of unforeseen losses, such as theft, fire, and natural disasters, by helping you rebuild and replace possessions that were lost While the definition of “adequate” coverage depends upon a […]
Author: Jesse M. Dimitro
Understanding the Importance of a Non-Contingent Offer
Making a non-contingent offer can dramatically increase your chances of securing a real estate transaction, particularly in competitive markets like New York City. However, buyers should understand that waiving contingencies, including those related to financing, or appraisals, also comes with significant risks. Determining your best strategy requires careful analysis of the property, the market, and […]
Author: Jesse M. Dimitro
Fred D. Zemel Appointed Chair of Strategic Planning at Scarinci & Hollenbeck, LLC
Business Transactional Attorney Zemel to Spearhead Strategic Initiatives for Continued Growth and Innovation Little Falls, NJ – February 21, 2025 – Scarinci & Hollenbeck, LLC is pleased to announce that Partner Fred D. Zemel has been named Chair of the firm’s Strategic Planning Committee. In this role, Mr. Zemel will lead the committee in identifying, […]
Author: Scarinci Hollenbeck, LLC
Novation Agreement Process: Step-by-Step Guide for Businesses
Big changes sometimes occur during the life cycle of a contract. Cancelling a contract outright can be bad for your reputation and your bottom line. Businesses need to know how to best address a change in circumstances, while also protecting their legal rights. One option is to transfer the “benefits and the burdens” of a […]
Author: Dan Brecher
What Is a Trade Secret? Key Elements and Legal Protections Explained
What is a trade secret and why you you protect them? Technology has made trade secret theft even easier and more prevalent. In fact, businesses lose billions of dollars every year due to trade secret theft committed by employees, competitors, and even foreign governments. But what is a trade secret? And how do you protect […]
Author: Ronald S. Bienstock
What Is Title Insurance? Safeguarding Against Title Defects
If you are considering the purchase of a property, you may wonder — what is title insurance, do I need it, and why do I need it? Even seasoned property owners may question if the added expense and extra paperwork is really necessary, especially considering that people and entities insured by title insurance make fewer […]
Author: Patrick T. Conlon
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Wall Street Reacts To Obama Tax Proposals
Author: Scarinci Hollenbeck, LLC
Shortly after Pres. Barack Obama unveiled his latest tax proposal during the recent State of the Union Address, financial services industry participants, republican lawmakers and top lobbyist on Wall Street have all voiced their criticisms of the would-be policy.
The Securities Industry and Financial Markets Association contended that the new tax, which would place a seven-basis point levy on the liabilities of the largest banks, insurance firms and investment management companies in the U.S and Wall Street., is a superfluous attempt to manage industry risk and could undermine lending, according to Bloomberg.
Obama announced this new plan in his most recent SOTU address after floating a similar proposal last year, when he suggested imposing a tax on the liabilities of banks holding $50 billion in assets, the media outlet reported. The new plan, which would generate tax revenue that is estimated to be twice as high, would extend to asset managers and insurance firms and provide a lower tax rate than the original proposal.
SIFMA president and CEO Kenneth Bentsen weighed in on the policy in a statement released Jan. 18.
‘Unintended consequences’
“Tax rules are often blunt instruments, and the tax code is not the place for a broad, new and duplicative financial regulatory regime,” he said. “This $110 billion targeted tax increase on America’s most productive financial institutions could have far-reaching unintended consequences that will curtail economic growth and job creation while negatively impacting the allocation of credit and the provision of financial services to individuals and institutions.”
He was not the only industry representative who spoke out against the proposal, as James Ballentine, chief lobbyist at trade organization the American Bankers Association, emphasized the challenges the new tax could create for the financial services industry, according to The Financial Times.
‘Difficult time’
“This really comes at a difficult time for an industry that is moving the economy forward,” he said, the media outlet reported. “To impose a fee, a flat tax, is certainly not warranted, and I hope Congress will reject this idea.”
Bentson also asserted that the proposed change was coming at a bad time and that it appeared oblivious to all the changes that lawmakers and regulators have made since 2009, according to Bloomberg. While he emphasized that government officials have been working on changing the regulatory environment for years, democrats in congress have been playing tug of war with industry as its representatives make an effort to take the bite out of the Dodd-Frank Act.
These struggles could experience key shifts after the republicans managed to enjoy key victories in both the House and Senate. These conservative lawmakers are not likely to approve another tax hike, as they have argued that such efforts hold back economic growth, according to The Financial Times.