An important pillar of the Alliance’s economic policy is the proposal to replace the goods and services (GST) with a Financial Transactions Tax (FTT). This report examines whether FTT should be preferred to GST on efficiency and equity grounds. It also analyses whether FTT would be a desirable tax is GST were retained. The focus here is on whether FTT would improve the efficiency of financial markets. Both issues are investigated from a public policy perspective.