Commentary

Joanna Fields
Traders Magazine Online News

Navigating Cybersecurity on a Stretch of "Regulatory Rapids"

In this shared commentary, Aplomb Strategies writes that when considering a firm’s governance structure, a holistic approach makes the most sense.

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Would you feel better if the Chicago Stock Exchange were purchased by U.S. firm or consortium rather than a foreign one?

Yes

73%

No

4%

Doesn't matter to me

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September 30, 2001

As Long as You're Cutting Taxes ....

By Gregory Bresiger

A tax cut is needed to stimulate the eco nomy and the stock markets so Congress and the administration should provide the finishing touches for the Section 31(a) tax relief. That was the latest message from the STA, but this time the trading industry is now lobbying Treasury Secretary Paul O'Neill.

Bailout Package

Noting that the airlines recently were given a bailout package by the federal government, the STA, in a letter, said that, "in preparing an economic stimulus package, it is our hope investor fee relief is included to help our capital markets and economy." The STA commended the Federal Reserve for providing liquidity, but warned that more is needed to keep the capital markets from continuing their recent decline.

"One way to achieve this is through investor relief," wrote the STA, arguing these fees are costing investors $14 billion. "These fees have evolved into a tax on investors and capital formation. Inclusion of the fee reduction in an economic relief package would help improve our economy and encourage much needed investment." STA's favored legislation, if enacted, would put billions of dollars back in the pockets of investors, STA lobbyists have claimed.

Congressional supporters of Section 31(a) relief were seeking to have the measure added to the stimulus package that was speeding through Congress as Traders Magazine went to press.

They argue that Section 31(a) reduction is a logical fit with other tax reductions that are proposed. It is critical that Section 31 (a) relief is attached to the stimulus, say supporters of the measure.

"Unless we are able to add Section 31(a) to the recovery package, there is no guarantee that we will get fee relief this year," said a spokesman for the Securities Industry Association, which has been lobbying with the STA for the tax cut for the securities industry. The industry has tried and failed several times to carry Section 31(a) relief over the past few years.