Regulated Investment Company Modernization Act Of 2010

Floor Speech

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Mr. NEAL. Madam Speaker, I yield myself such time as I might consume.

Madam Speaker, more than 100 years ago, the first U.S. mutual fund was started in Boston. Mutual funds have been a way of life for ``everyman'' to invest in the market, with the benefits of pooling and diversification. Indeed, it invites the term ``mutualization.'' Today, more than 50 million households invest through mutual funds with a median household income of $80,000. More than 50 percent of 401(k) plan assets were invested in mutual funds at the end of 2009.

H.R. 4337 was introduced last year by Mr. Rangel and me to modernize the tax laws regarding regulated investment companies, better known as mutual funds. A technical explanation and revenue table for this bill may be found on the Joint Tax Web site, www.jct.gov.

The tax rules that relate to mutual funds date back more than a half century. Although these rules have been updated from time to time, it has been over 20 years since they were last revisited. The bill before us today would make several changes to the Tax Code to address outdated provisions, such as rules that relate to preferential dividends and rules that require mutual funds to send separate annual dividend designation notices to shareholders and rules that prevent mutual funds from earning income from commodities.

In June, my subcommittee, the Select Revenue Measures Subcommittee, reviewed this legislation with a panel of experts who expressed support for these changes.

Today, I am pleased to be joined by my friend, the gentleman from Michigan (Mr. Camp), in bringing this bill to the floor with a few technical changes and revenue offsets from within the industry. The Ways and Means Committee has the responsibility to review our tax rules from time to time, remove the dead wood, and update where necessary. This bill accomplishes that to the benefit of investors, taxpayers, and mutual fund companies. I urge its adoption.

I reserve the balance of my time.

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Mr. NEAL. Madam Speaker, I yield myself such time as I might consume.

Madam Speaker, we held a hearing on this bill. It is well received by the investors; it is well received by the mutual fund companies, and it certainly received no negative commentary in the House. Why cannot we just come to this floor and speak to the issue at hand?

I worked hard on this piece of legislation with Mr. Tiberi for a long period of time. This is the legislation that's in front of this Congress at this particular time. It was well met because it was fully vetted in the committee with sufficient opportunity for any- and everyone to comment on it.

This is a product that we should be proud of. For the first time in two decades, we are modernizing issues that relate to the industry that many, if not millions, of Americans come to depend upon for retirement. I don't understand why there would be any additional argument made on any other piece of legislation that was being considered when, in fact, this is the matter that's before us at this particular time.

I reserve the balance of my time.

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