London Stock Exchange Chief Steps Up Stamp Duty Abolition Campaign

by Carla Johnson, Investors Offshore.com

17 December 2001

Following the UK Chancellor's failure to deal with the issue of stamp duty on stock transactions in his pre-budget report, London Stock Exchange Chairman Don Cruikshank has announced that he is stepping up his campaign to have the antiquated tax abolished.

Speaking in the City last week, Mr Cruikshank sought to dispel the myth that stamp duty is a 'victimless' tax, and called it an 'unseen cancer' eating away at the ability of British companies to invest.

The LSE chief expressed his disappointment that despite ongoing industry calls for the abolition of stamp duty on share trading, backed up by strong public support for the measure, it had once again failed to make the agenda: 'Just a sign that the issue is on the table would have been a clear signal to institutional investors, for example, that this is not a cost that it needs to account for in its long-term modelling,' he explained. 'As it is, UK companies will increasingly lose out on domestic and international investment.'

Mr Cruikshank drew on the experience of new World Trade Organisation member state, China, to demonstrate the fact that the vast majority of countries in the world are choosing to reduce or abolish the tax. 'Knowingly opting for lower investment through the imposition of stamp duty beggars belief,' he said, adding: 'Every modern economy has virtually got rid of such a transaction tax.'

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