Elizabeth Warren wants to tax your retirement - (so does Bernie Sanders) Posted: Nov 30th, 2019 - 7:16 am
Presidential candidate Elizabeth Warren has said that none of her tax-increase plans would hit average people, pledging not to "raise taxes on the middle class by one penny." Yet Warren and several other presidential candidates, including Bernie Sanders, are pushing a financial transactions tax that would cost everyday people saving for the future. This plan is a retirement tax that would affect millions of middle-class people.
Proponents of the financial transactions tax argue it is "tiny tax" that would only hit rich Wall Street speculators. Nothing could be farther from the truth. A financial transactions tax would hit every single person who saves and invests in a mutual fund, a retirement account, a college savings fund, or a pension plan.
According to the Federal Reserve, 52% of households in the United States own stock. That's 65 million households. According to the Investment Company Institute, 99.5 million people have mutual funds, and millions of people have IRAs, 401k plans, and college savings plans. The Warren financial transaction tax would hit the millions of average savers and investors in each of these plans. Her tax would also affect workers saving for their retirement in state and city pension plans, and ordinary people saving with annuities and mutual funds.
A study by the Modern Markets Initiative found that the financial transaction tax is "a retirement tax on American savers" that would come "directly from the pockets of Main Street investors saving for retirement, college, and other life milestones."
Another study by Vanguard said that a financial transaction tax would hit millions of investors saving for retirement. The analysis found that a financial transaction tax would force individual investors to work 2 1/2 years longer to reach their retirement goal.
The tax would do widespread harm to individuals, our financial markets, and the economy. It would hit every transaction in an individual's account, reduce the rate of return in every account, and reduce stock prices and the value of every account, causing further havoc to retirement savings and devastating the nest eggs of millions of retirees.
A financial transaction tax would hurt everyone. It would damage U.S. financial markets, reducing liquidity and increasing market volatility. It would raise the cost of capital, discourage investment, increase consumer prices, and damage economic growth. Inevitably, it would lead to the loss of jobs, further penalizing average working people.
In short, this "tiny tax" is a terrible idea that would cause lasting harm to average savers, workers, retirees, and the U.S. economy.
LINK/URL: Elizabeth Warren wants to tax your retirement
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