Mr. Green reacted more positively to the proposed effective dates for the tax increases. Mr. Green was referring to the reaction of market participants to the administration's December 1995 balanced budget proposal, which included similar corporate tax increases but with immediate proposed effective dates. As a result, the new issuance of certain instruments was shut down for an extended period of time. The Bond Market Trade Association represents securities firms and banks that underwrite, trade and sell debt securities, both domestically and internationally. Industries accessing the market included banks, utilities, media and telecommunication concerns.
Corporations use short-term tax exempt instruments as part of their cash management activities.
In addition, tax-exempt bonds issued to provide low cost housing financing and student loans would be affected by the administration's proposal.