Commentary

David Weisberger
Traders Magazine Online News

Stop the BS & Promote Real Transparency!

In this shared blog, David Weisberger says a recent WSJ article is wrong and that traders do need to purchase faster and more comprehensive market data to avoid being fined for violating "Best Execution" obligations.

Traders Poll

Is information leakage a major concern of yours when you trade?



Free Site Registration

May 31, 2002

More Section 31(a) Relief? Don't Count on It

By Gregory Bresiger

Enjoy what you have because more tax relief is not on the way.

Traders, many of whom were somewhat disappointed earlier this year by the actual reduction in Section 31(a) fees, should not expect another reduction.

They should be happy with the some 25 percent reduction in the stock transaction charge, which was signed into law a few months ago. That was the message from a member of Congress and various trading industry officials.

An Improvement

"It's clearly an improvement over what was there and maybe over time there will be another cut, but in the short term it would be difficult to get more," according to Vito Fossella (R-N.Y.), a key member of Congress and one of the leaders last year in the movement to reduce Section 31(a) fees.

Nevertheless, STA officials agreed that a number of their members had expected a much bigger cut in the fee, possibly closer to 50 percent.

The fee, which has been used to fund the costs of the SEC, had been generating about six times the SEC's budget before the cut, STA officials said. With the cut, it has been reduced to about two and a half times the agency's budget, but there are no immediate plans to drop the rate some more, STA officials said.

"Clearly, when the reduction was approved we were not focused on the formula that would be used to actually reduce the tax," said John Giesea, president of the STA.

"We're fortunate with what we got because now we know that the federal deficit is going higher and higher," he added.