A discussion draft on the taxation of financial products released by House Ways and Means Committee Chair Dave Camp, R-Mich., on January 24 would repeal section 1256 for all contracts and would mark most derivatives to market at the end of each tax year. The draft comes more than a year after the Ways and Means and Senate Finance committees held a joint hearing on the topic. That hearing largely focused on the marking of financial instruments to market. "The U.S. is a leader in the financial world, but our broken and antiquated tax code has failed to keep up with the rapid pace of financial innovation on Wall Street," Camp said in a statement. "The lack of consistent and comprehensive tax policy has also contributed to some corporate scandals and the recent financial crisis that devastated our economy and threatened our standing in the global community."
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