Security Traders Association Opposes Proposed Modernization Of Derivatives Act – Finance and Banking – United States – Mondaq News Alerts

In a letter dated September 17, 2021,
addressed to Senate Committee on Finance Chair Ron Wyden and
ranking member Michael Crapo, the Security Traders Association
(“STA”) highlighted the negative impact proposed
legislation on derivatives would have on investors. The Modernization of Derivatives Tax Act of
2021 (“MODA”) would create a single tax regime
for all derivatives, which would require mark-to-market treatment,
source gains and losses to the taxpayer’s country of residence,
and tax derivatives at ordinary income rates. The STA warned that
the legislation would have the effect of reducing liquidity in the
U.S. equity market.

n addition to MODA, Senator Wyden recently released draft
legislation on a number of tax issues, including proposals
to expand the pass-through deduction, limit “Mega-IRAs”, increase carried interest rates, and reform partnership taxation.
(See linked Cadwalader summaries).

Primary Sources

1. STA Comment Letter: Modernization of Derivatives
   Tax Act (MODA 2021)
2. 2621: Modernization of Derivatives Tax Act of
   2021

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