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Monday, November 26, 2007|
Fund Firms Push for Change in Tax Treatment of ETNs
The mutual fund industry is unhappy over the tax treatment of exchange-traded notes, arguing that the current treatment gives ETNs an unfair advantage over mutual funds. Investors Business Daily reports that ICI president Paul Schott Stevens had sent a letter to the ranking members of the House Ways and Means Committee, Rep. Charles Rangel (D-NY) and Jim McCrery (R-LA), seeking change in the tax treatment. At present, ETNs are taxed when a share is sold. The ICI wants ETNs to report accrued income in the same manner as mutual funds. Meanwhile, SIFMA has also weighed in on the matter, saying that ETNs' tax treatment should stay the same because they are more like futures contracts.
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