A US Treasury plan to remove the 60/40 tax treatment for dealers’ income has been attacked as damaging to the US derivatives market by industry participants.
President Barack Obama announced on May 13 that he planned to generate $58bn by closing unfair loopholes in the tax system.
One proposal was to abolish the 60/40 tax rule – a 28 year old tax benefit for commodities brokers.
Derivatives market makers are allowed to pay 60% of their income tax at the capital gains rate,...