| Committee/Subcommittee: | Activity: | |
| Senate Finance | Referral | |
***NONE***
***NONE***
| Sen Craig, Larry E. - 5/13/1999 |
TABLE OF CONTENTS:
Freedom and Fairness Restoration Act of 1997 - Title I: Tax Reduction and Simplification; Supermajority Required for Tax Changes - Subtitle A: Tax Reduction and Simplification - Amends the Internal Revenue Code to impose a 20 percent tax (17 percent after December 31, 1998) on the taxable income of every individual.
Redefines "taxable income" to mean the amount by which wages, retirement distributions, and unemployment compensation exceed the standard deduction. Increases the basic standard deduction and includes an additional standard deduction for dependents. Includes in taxable income the taxable income of each dependent child under the age of 14. Provides for inflation adjustments.
(Sec. 102) Replaces the current tax on corporations with a tax on every person engaged in a business activity equal to 20 percent (17 percent after December 31, 1998) of the business taxable income of such person. Makes the person engaged in the business activity liable for the tax.
Imposes a tax of 20 percent (17 percent after December 31, 1998) on the value of excludable compensation provided during the year by an employer for the benefit of employees. Makes the employer liable for the tax.
(Sec. 103) Repeals: (1) numerous provisions relating to pension plans; and (2) provisions imposing a tax on any employer reversion from a qualified plan.
Revises requirements regarding transfers of excess pension assets.
(Sec. 104) Repeals from the Internal Revenue Code: (1) the part relating to alternative minimum tax; (2) the part relating to credits against tax; (3) the subtitle relating to estate and gift taxes; and (4) subject to exception, the chapter relating to normal taxes and surtaxes.
Subtitle B: Supermajority Required for Tax Changes - Makes it not in order in the House of Representatives or the Senate, unless waived or suspended in the House or the Senate by a three-fifths vote of the Members, to consider any bill, joint resolution, amendment thereto, or conference report thereon that includes any provision that increases an income tax rate, creates an additional tax rate, reduces the standard deduction, or provides any exclusion, deduction, credit, or other benefit that results in a reduction in Federal revenues.
Title II: Spending Restraint and Budget Process Reform - Subtitle A: Balanced Budget by Fiscal Year 2002 - Amends the Congressional Budget Act of 1974 to establish maximum spending amounts for FY 1998 through 2002 and revises sequestration procedures for enforcement.
(Sec. 203) Makes it not in order in the House of Representatives or the Senate, unless waived or suspended in the House or the Senate by a three-fifths vote of the Members, to consider any bill, joint resolution, amendment thereto, or conference report thereon that includes any provision that would result in total spending for a fiscal year exceeding the maximum permissible total spending amount for that fiscal year.
Subtitle B: Zero Based Budgeting and Decennial Sunsetting - Terminates, effective October 1, 1997, the spending authority for each unearned entitlement and high-cost discretionary spending program unless such spending is reauthorized after enactment of this Act.
Provides that effective on the first day of the fiscal year beginning in the first decennial census after the year 2001 and each ten years thereafter, such spending authority shall terminate unless reauthorized after the last date it was required to be reauthorized under this subtitle.
Terminates, effective October 1, 1998, spending authority for each discretionary spending program (not including high-cost discretionary spending programs) unless such spending authority is reauthorized after the enactment of this Act. Provides that effective on the first day of the fiscal year beginning in the first decennial census after the year 2001 and each ten years thereafter, such spending authority shall terminate unless reauthorized after the last date it was required to be reauthorized under this subtitle.
Defines the terms: (1) "unearned entitlement" to mean an entitlement not earned by service or paid for in total or in part by assessments or contributions such as social security, veterans, benefits, and retirement programs; and (2) "high-cost discretionary program" to mean the most expensive one-third of discretionary programs within each budget function account.
(Sec. 212) Prohibits the House of Representatives or the Senate from considering any bill, joint resolution, amendment, or conference report that includes any provision appropriating funds unless such appropriation has been previously authorized by law. Permits the waiver or suspension of the provisions of this section by an affirmative vote of three-fifths of the Members.