Bush Budget Contains New User Fee For Futures, Options
By Christopher Faille, Reporter
Wednesday, February 06, 2002
WASHINGTON (HedgeWorld.com)—The budget for fiscal year 2003, formally submitted to Congress Feb. 4, includes a user fee on commodity futures and options contracts traded on U.S. futures exchanges, dedicated to funding a portion of the activities of the Commodity Futures Trading Commission.
“Our budget will run a deficit that will be small and short-term,” said President Bush during his Jan. 29 state of the union address, “so long as Congress restrains spending and acts in a fiscally responsible manner.”
Not everyone agrees with the idea of fiscal responsibility inherent in this particular proposal. Almost immediately upon the submission of the budget, the chairman of the board and the president of the Chicago Board of Trade jointly issued a memorandum to their membership vowing a fight.
Nickolas J. Neubauer and David J. Vitale noted that the move is not surprising given the current budget situation, “the fee is expected to generate approximately $33 million” and policy makers are on the lookout for new sources of revenue.
But Messrs. Neubauer and Vitale call the proposal misguided, given “the importance of liquidity in maintaining our leadership role in the market, and the competitive pressures we face from easily substitutable exchange and non-exchange marketplaces.”
They promised to make that argument in Congress, and “to portray this proposal as the tax that it is.” |
