Commentary

John Turney
Traders Magazine Online News

Foreign Exchange Infrastructure: Yesterday, Today and Tomorrow

In this exclusive to Traders Magazine, John Turney, Global Head of Outsourced FX at Northern Trust, discusses the evolution of the fx infrastructure and what is to come.

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Too Big to Fail

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December 1, 2001

Stimulus Package, No Section 31 Reform

By Gregory Bresiger

Section 31(a) reform remains in legislative limbo, waiting for action by lawmakers. Questions remain over whether the bill, which would reduce the transaction tax, will become law this year.

"I think it is dead for the year. We tried very hard, but the events of Sept. 11 just stopped this thing. We had some bad luck," said a securities industry lobbyist, who did not want to be quoted by name.

Incoming STA President John Giesea is still hopeful that the Section 31(a) legislation can be signed into law this year, but he concedes that there are obstacles (see cover story). While the STA continues to wait, several other tax provisions that were wanted by the securities industry were passed in a recent economic stimulus package approved by the House. Included in the package were income tax reductions as well as a reduction in capital gains taxes. It was possible that the tax stimulus bill might have had the Section 31(a) reform provisions added, but that did not happen. If the current Section 31 legislation doesn't pass this year or in 2002, then the STA would have to begin again in the next session of Congress, which starts in January 2003.