Republican members of the House Financial Services Committee led by Ranking Member Patrick McHenry (R-NC) recently released a resolution condemning efforts to impose a financial transactions tax. If enacted into law, this tax would harm investors and savers, restrict economic growth, and would serve as an unreliable source of revenue that may fail to what supporters claim.

Rep. Ilhan Omar (D-Minn.), Rep. Ro Khanna (D-Calif.), Sen. Bernie Sanders (I-Vt.), Rep. Peter DeFazio (D-Ore.), and others on the progressive left have called for this new tax, which would be imposed at a rate of 0.1 percent on any buying and selling of stocks, bonds, and other financial instruments. .

Though the 0.1 percent rate may seem like a small amount, it would be imposed on every single trade and would raise $1 trillion over the next decade.

While the Left claims this tax will make Wall Street pay “their fair share,” the FTT is really a tax on American savers and investors, including the 53 percent of American households that own stock and the 80 to 100 million Americans that have a 401(k). 

This tax would also harm public pension funds leading to fewer savings, less retirement income for retirees, and underfunded pensions. This will fall disproportionately hard on public sector pensions including those used by teachers, firefighters, and police officers.

The recent GameStop trading controversy and negative perceptions of the hedge fund industry are simply excuses used by Democrats to push an agenda they already had – trillions in new taxes on the American people.

The Left wrongly argues that an FTT is needed to curb short selling and market volatility. Short selling is simply a function of the free market and occurs when investors think a stock is overvalued. It helps promote efficiency and provide information to the markets.

Republicans on the Financial Services Committee including Ranking Member McHenry and Reps. Tom Emmer (R-Minn.), Rep. Andy Barr (R-Ky.), Rep. Bill Huizenga (R-Mich.) should be applauded for standing against this new tax on American investors. 

Lawmakers on the committee also recently released The “Protecting Retirement Savers and Everyday Investors Act,” legislation that would block states from imposing FTTs on out-of-state investors.

There is also strong conservative opposition to this tax. In a letter signed by almost 30 groups and activists, ATR released a letter arguing that the FTT would“ be borne by the American people, not Wall Street. It would punish investment, leading to lower returns for American retirees and savers and increased market volatility.”

Republicans on the House Financial Services Committee should be applauded for their efforts to oppose an FTT. The push to impose this tax would not harm Wall Street as the far Left claims, but would harm investors, pension funds, and savers across the country.