This study examines the impact of changes in reserve requirements on large banks' stock returns. It finds statistically and economically significant abnormal returns on the day following the announcement of such changes. This finding is consistent with the notion that reserve requirements are a tax on deposits. It indicates, however, that bank's shareholders bear at least part of the tax; thus it does not support the hypothesis advanced by some authors that the tax falls exclusively on banks' borrowers. The evidence further suggests that part of the tax falls on demand depositors. These findings undercut the case for the uniqueness of bank loans insofar as it is based on the incidence of the deposit tax.