First, the DBCFT could ignore them, as VATs typically do. Second, the DBCFT could provide a full deduction for financial investments, just as it proposes treating investments in other business assets (see post on Capital Expenditures
). Third (and what the author suggests is most likely), the DBCFT could tax financial transactions on the difference between their cost basis and the amount realized, as in our current system of income taxation. The analysis and conclusion raise a number of questions about WTO compliance and the interplay between taxation of businesses and individuals, which the article discusses in more detail.