NYSE warns of New York exit if trades are taxed

The head of the New York Stock Exchange warned the trading house could relocate if state officials tax stock trades
The head of the New York Stock Exchange warned the trading house could relocate if state officials tax stock trades SPENCER PLATT GETTY IMAGES NORTH AMERICA/AFP/File
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New York (AFP)

Is the New York Stock Exchange (NYSE) about to leave New York City?

That possibility was raised Tuesday by the exchange's President Stacey Cunningham, who warned in a column published in The Wall Street Journal that the hallowed financial institution on New York's Wall Street could flee if the state imposes a tax on stock trades.

"While New York has remained a center of gravity for the financial industry, many employees of 'Wall Street' firms are migrating to Florida, Texas and other states with hospitable tax policies," Cunningham said.

She praised a 1981 decision by New York state to stop collecting a tax on stock trades, but warned, "If lawmakers opt to reinstate that tax, the NYSE may need to follow the lead of those relocating firms. Some of our customers are already asking about our willingness to relocate."

Senior New York state lawmakers have signaled interest in enacting a tax on stock sales to address a dire budget shortfall in connection with the coronavirus downturn.

However, officials from the administration of New York Governor Andrew Cuomo have suggested they oppose such a measure.

Cunningham last week co-signed a letter from some 25 securities industry leaders criticizing taxes on stock trades.

In her op-ed, Cunningham pointed to examples in recent history of how taxes on stock trading imposed by France and Sweden drove business to London.

"The securities industry should stay in the Big Apple where it belongs," Cunningham wrote. "But if New York is to remain the financial capital of the world, it needs to avoid the folly of this tax and show that it truly understands how market forces work."