Tax on Wall Street Speculation Act

This bill imposes a tax on certain trading transactions, including stocks, bonds, derivatives, and digital assets, to raise revenue for investments in families, communities, infrastructure, the environment, and financial security, while also reducing market volatility. It provides an offsetting credit for lower-income individuals who pay the tax.

Sec. 2, Transaction tax: A tax is imposed on the transfer of ownership in each covered transaction involving a security. The tax rate is 0.5% for stocks, partnership interests, and digital assets; 0.10% for bonds and other debt instruments (excluding certain short-term debt); and 0.005% for derivatives. The tax is based on the fair market value of the security or underlying investment. Covered transactions include purchases occurring or cleared in the United States, or involving a U.S. person. Exceptions include initial issuances, certain short-term debt traded in the U.S., and securities lending arrangements. The tax is generally paid by the trading facility or broker, with special rules for direct transactions. The Secretary of the Treasury must consult with the SEC and CFTC and issue regulations to prevent avoidance. A penalty is imposed for failing to include required covered transaction information on a return.

Sec. 3, Offsetting credit for financial transaction tax: An eligible individual (age 18 or older, U.S. citizen or lawful permanent resident, not a student or certain other taxpayers) may claim a credit against income tax equal to the tax paid under section 4475 on covered transactions where the taxpayer is the beneficial owner. The credit is not available if modified adjusted gross income exceeds $50,000 ($75,000 for joint returns), adjusted for inflation after 2024. The credit applies to taxable years beginning after December 31, 2023.