Well that's just it. Who cares if they gouge the shit out of each other? As long as they're no longer raping and pillaging retail traders, then let them find whatever loop holes they want to go off and do it to each other.
Taxing it just seems like the wrong response. By taxing it, we're giving it the rubber stamp of approval as ethical and ok to do, as long as they pay a piddly 1%.
Do you want to allow parasitical 'speculators' (and HFT isn't really even speculation, and gives the legitimate role of speculators a bad name, it's more of a private tax on legitimate traders) power in your society? There is something wrong with someone gaming the system and effectively leveling a tax (through HFT) on all legitimate business, but this tax is not a tax to enrich the Treasury and pay for something at least possibly worthwhile, it goes to people who have no qualm with conducting rape-and-pillage economics. Do you want such people to gain power in the world? If so, then do nothing. If you don't want to allow beneficiaries of ill-gotten loot to have massive influence over your life (through subsequent purchase and corruption gained through this loot) then do something about it, as I am proposing by supporting a Tax to end this.