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IRS Should End Commodity Mutual-Fund Runaround, Levin Says

U.S. tax authorities should stop a private rulemaking process that has encouraged speculation in oil and agricultural markets by letting mutual funds exceed limits on commodity investments, Senator Carl Levin said.

The Internal Revenue Service’s so-called private letter rulings, which let funds use foreign corporations and other strategies to escape the tax implications of boosting commodity holdings above 10 percent of income, are a “blatant end-run around the legal restrictions,” Levin said today at a hearing held by the Senate Permanent Subcommittee on Investigations.