In the past, former Vice President Joe Biden has expressed his support for a financial transactions tax. Now, New Jersey is trying to implement one of its own to bolster its broken budget. The move’s effect could be the opposite of that intended. The NYSE, the world’s largest stock exchange by market capitalization, said it plans to leave New Jersey if the state implements the tax. Bloomberg’s Elize Young reports:
The New York Stock Exchange told New Jersey lawmakers that it’s prepared to move operations out of state should they impose a new tax on electronic trades via data servers.
In late September, the world’s largest exchange by market capitalization conducted a test “for a wholesale transition out of New Jersey,” Hope Jarkowski, co-head of government affairs for NYSE parent Intercontinental Exchange Inc., said during an Assembly financial institutions and insurance committee hearing conducted by video feed.
“From Sept. 28 to Oct. 2, we moved our production servers for our NYSE Chicago exchange out of New Jersey to our secondary data center,” she said. “Proximity to New York City is no longer relevant in today’s trading environment.”
Lawmakers in New Jersey, a state so fiscally damaged by the pandemic that it’s borrowing $4.5 billion to plug a budget gap, are considering charging a temporary tax of a hundredth-cent per trade, down from an earlier proposal of a quarter-cent levy. Taxing financial transactions has support from Governor Phil Murphy, a first-term Democrat and retired Goldman Sachs Group Inc. executive, who said he personally had spoken with NYSE and Nasdaq representatives about what he called “our hour of need.”
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