Journal of Financial Services Research

, Volume 7, Issue 1, pp 75–91 | Cite as

Taxing transactions in futures markets: Objectives and effects

  • Franklin R. Edwards


In the last few years various legislative proposals have been made to impose a transaction or excise tax on securities and derivative market transactions. Although there have been considerable discussion and analysis of the wisdom of imposing such a tax on securities markets, there has been no analysis of the pros and cons of extending the tax to futures markets. This article attempts to fill this gap, first, by examining the various rationales advanced to support a tax on securities markets to determine their applicability to futures markets and, second, by analyzing the likely effects of the tax on the competitiveness and efficiency of futures markets. In addition, the revenue-raising potential of a tax on futures transactions is evaluated. I conclude that a tax on futures markets will not achieve any important social objective and will not generate much revenue.


Future Market Security Market Market Transaction Social Objective Considerable Discussion 
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Copyright information

© Kluwer Academic Publishers 1992

Authors and Affiliations

  • Franklin R. Edwards
    • 1
  1. 1.Graduate School of BusinessColumbia UniversityNew York

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