-159- Daubert v. Merrell Dow Pharm. Inc., 509 U.S. 579, 592 n.10 (1993). OPINION I. Overview These cases address the Federal income taxation of financial derivatives. Congress has required for approximately the last 10 years that taxpayers participating in certain types of financial derivatives report the value of those derivatives at their fair market value. The taxpayers subject to this valuation requirement are plentiful, and the tax dollars affected by this requirement reach into the billions, if not the trillions.55 Congress chose cognizantly not to promulgate explicit rules mandating valuation methods for this purpose. H. Conf. Rept. 103-213, at 616 (1993), 1993-3 C.B. 393, 494. Congress opted instead to delegate to the Department of the Treasury (Treasury Department) the authority to promulgate these rules while advising the Treasury Department that “the conferees expect that the Treasury Department will authorize the use of valuation methods that will alleviate unnecessary compliance burdens for 55 As to the regularity of interest rate swap transactions, it has been noted by the Court of Appeals for the Seventh Circuit, the court to which an appeal of these cases would typically lie, that “‘The swaps dealers--mostly banks--that create, market, and broker these [interest rate swaps] deals have made billions.’” Caisse Nationale de Credit Agricole v. CBI Indus., Inc., 90 F.3d 1264, 1267 n.1 (7th Cir. 1996) (quoting Greising, “Chicago’s Swaps Sweepstakes”, Business Week, June 14, 1993).Page: Previous 149 150 151 152 153 154 155 156 157 158 159 160 161 162 163 164 165 166 167 168 Next
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