Release Date: February 9, 2016         
Contact: Carol Danko, 202.962.7390, [email protected]       

 SIFMA Statement on President Obama’s FY 2017 Budget Proposal

Washington, D.C., February 9, 2016 – SIFMA today released the following statement from president and CEO, Kenneth E. Bentsen, Jr. in response to various provisions contained in the President Obama’s Fiscal Year 2017 Budget Proposal:

Bank Tax

“Over the past seven years, the Obama Administration, Congress, regulators and the financial services industry have undertaken unprecedented steps through legislation, regulation and corporate changes to address concerns about excessive risk in the financial sector.  These changes have resulted in dramatic increases in quantity and quality of capital held against risk by financial institutions, the means by which to resolve failing systemic institutions without taxpayer funds, new rules and restrictions to mitigate risk from multiple financial products, new laws and rules that will and have altered the corporate structure of financial institutions, new rules that limit exposure among financial institutions, new rules that limit leverage of financial institutions, and industry-driven changes in business practices.  

“The imposition of a special, sector-only tax on the vast array of financial institutions captured by the President’s proposal under the guise of further limiting excessive risk completely ignores the changes this Administration, Congress, regulators and industry have implemented.

“Tax rules are often blunt instruments, and the tax code is not the place for a broad, new, and duplicative financial regulatory regime. This targeted tax increase on America’s most productive financial institutions could have far-reaching unintended consequences that will curtail economic growth and job creation while negatively impacting the allocation of credit and the provision of financial services to individuals and institutions.”

Retirement

“We support the President’s goal of increasing retirement savings through greater access to workplace accounts and creating more portable options. We believe that federal programs like MyRA and open MEPs bring us closer to that goal.  We remain opposed to the Department of Labor’s conflict of interest rule that will only harm investors by limiting choice and access to advice while raising the cost of saving for retirement.”

Municipal Bonds

“We appreciate the President’s proposal to encourage infrastructure investment by introducing America Fast Forward Bonds and to address limitations in the use of tax-exempt bonds. However, the 28-percent cap on tax preferences would impose a partial tax on municipal bond interest that would add further financial burdens to our cash-strapped state and local governments, ultimately discouraging investment in infrastructure projects and stifling job creation.”