Flash Boys: "That was the tax"

At the top of page 50 it states:

Someone out there was using the fact that stock market orders arrived at different times at different exchanges to front-run orders from one market to another.

Their program built in delays so that orders reached the exchanges at the same time. On pages 51-52:

But now there was a tool for gauging not just how orders reached their destination but how much money this Wall Street intermediation was removing from the pockets of investors large and small: Thor.

Brad explained to Mike Gitlin how his team had placed big trades to measure how much more cheaply they bought stock when they removed the ability of the machine to front-run them. For instance, they bought 10 million shares of Citigroup, then trading at roughly $4 per share, and saved $29,000 - or less than a tenth of 1 percent of the total price. "That was the tax" said Brad Park.

It's a metaphorical statement. They are likening the High Frequency scalp to a tax.

The "tax" in this case is not a normal government tax, but a metaphorical "tax" collected by high-frequency traders who were front-running the protagonists' orders.

It doesn't mean a tax to the government.

They mean that when they studied what was really happening with front running, they discovered that the front running systems were costing them money. They were costing everybody money. That 1/10th of 1% didn't seem like much but over time it was huge. It was like a tax becasue everybody paid it without even knowing it. It was sort of like the cost of doing business. They then set out to try and stop it.