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H.R.2414
Top Ten Terrible Tax Act of 1999 (Introduced in the
House)
SEC. 4. REPEAL OF EXCISE TAX ON TELEPHONE AND OTHER COMMUNICATIONS
SERVICES.
(a) IN GENERAL- Chapter 33 (relating to facilities and services) is
amended by striking subchapter B.
(b) CONFORMING AMENDMENTS-
(1) Section 4293 is amended by striking `chapter 32 (other than the
taxes imposed by sections 4064 and 4121) and subchapter B of chapter 33,'
and inserting `and chapter 32 (other than the taxes imposed by sections 4064
and 4121),'.
(2)(A) Paragraph (1) of section 6302(e) is amended by striking `section
4251 or'.
(B) Paragraph (2) of section 6302(e) is amended--
(i) by striking `imposed by--' and all that follows through `with
respect to' and inserting `imposed by section 4261 or 4271 with respect
to', and
(ii) by striking `bills rendered or'.
(C) The subsection heading for section 6302(e) is amended by striking
`COMMUNICATIONS SERVICES AND'.
(3) Section 6415 is amended by striking `4251, 4261, or 4271' each place
it appears and inserting `4261 or 4271'.
(4) Paragraph (2) of section 7871(a) is amended by inserting `or' at the
end of subparagraph (B), by striking subparagraph (C), and by redesignating
subparagraph (D) as subparagraph (C).
(5) The table of subchapters for chapter 33 is amended by striking the
item relating to subchapter B.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to
amounts paid pursuant to bills first rendered more than 90 days after the date
of the enactment of this Act.
SEC. 5. REPEAL OF MARRIAGE PENALTY IN INDIVIDUAL INCOME TAX RATES AND STANDARD DEDUCTION.
(a) RATES- Section 1 (relating to tax imposed) is amended by striking
subsections (a) through (e) and inserting the following:
`(a) MARRIED INDIVIDUALS FILING JOINT RETURNS AND SURVIVING SPOUSES- There
is hereby imposed on the taxable income of--
`(1) every married individual (as defined in section 7703) who makes a
single return jointly with his spouse under section 6013, and
`(2) every surviving spouse (as defined in section 2(a)),
a tax determined in
accordance with the following table:
`If taxable income is:
The tax is:
Not over $51,500
15% of taxable income.
Over $51,500 but not over $124,900
$7,725, plus 28% of the excess over $51,500.
Over $124,900 but not over $260,500
$28,277, plus 31% of the excess over $124,900.
Over $260,500 but not over $566,300
$70,313, plus 36% of the excess over $260,500.
Over $566,300................
$180,401, plus 39.6% of the excess over $566,300.
`(b) HEADS OF HOUSEHOLDS- There is hereby imposed on the taxable income of
every head of a household (as defined in section 2(b)) a tax dete rmined in accordance with the
following table:
`If taxable income is:
The tax is:<
/center>
Not over $34,550
15% of taxable income.
Over $34,550 but not over $89,150
$5,182.50, plus 28% of the excess over $34,550.
Over $89,150 but not over $144,400
$20,470.50, plus 31% of the excess over $89,150.
Over $144,400 but not over $283,150
$37,598, plus 36% of the excess over $144,400.
Over $283,150
$87,548, plus 39.6% of the excess over $283,150.
`(c) OTHER INDIVIDUALS- There is hereby imposed on the taxable income of
every individual (other than an individual to whom subsection (a) or (b)
applies) a tax determine d in
accordance with the following table:
`If taxable income is:
The tax is:
Not over $25,750
15% of taxable income.
Over $25,750 but not over $62,450
$3,862.50, plus 28% of the excess over $25,750.
Over $62,450 but not over $130,250
$14,138.50, plus 31% of the excess over $62,450.
Over $130,250 but not over $283,150
$35,156.50, plus 36% of the excess over $130,250.
Over $283,150
$90,200.50, plus 39.6% of the excess over $283,150.
`(d) ESTATES AND TRUSTS- There is hereby imposed on the taxable income
of--
taxable under this subsection a tax determined in accordance with the following
table:
`If taxable income is:
The tax is:
Not over $1,750
15% of taxable income.
Over $1,750 but not over $4,050
$262.50, plus 28% of the excess over $1,750.
Over $4,050 but not over $6,200
$906.50, plus 31% of the excess over $4,050.
Over $6,200 but not over $8,450
$1,573, plus 36% of the excess over $6,200.
Over $8,450
$2,383, plus 39.6% of the excess over $8,450.'.
(1) IN GENERAL- Paragraph (2) of section 63(c) (relating to standard
deduction) is amended to read as follows:
`(2) BASIC STANDARD DEDUCTION- For purposes of paragraph (1), the basic
standard deduction is--
`(A) $8,600 in the case of--
`(ii) a surviving spouse (as defined in section 2(a)),
`(B) $6,350 in the case of a head of household (as defined in section
2(b)), or
`(C) $4,300 in any other case.'
(2) TECHNICAL AMENDMENTS-
(A) Paragraph (4) of section 63(c) is amended to read as
follows:
`(4) ADJUSTMENTS FOR INFLATION- In the case of any taxable year
beginning in a calendar year after 1999, each dollar amount contained in
paragraph (2) or (5) or subsection (f) shall be increased by an amount equal
to--
`(A) such dollar amount, multiplied by
`(B) the cost-of-living adjustment determined under section 1(f)(3)
for the calendar year in which the taxable year begins.'
(B) Subparagraph (A) of section 63(c)(5) is amended by striking `$500'
and inserting `$700'.
(C) Subsection (f) of section 63 is amended by striking `$600' each
place it appears and inserting `$850' and by striking `$750' in paragraph
(3) and inserting `$1,050'.
(D) Subparagraph (B) of section 1(f)(6) is amended by striking
`subsection (c)(4) of section 63 (as it applies to subsections (c)(5)(A)
and (f) of such section)' and inserting `section 63(c)(4)'.
(c) CONFORMING AMENDMENTS RELATED TO INFLATION ADJUSTMENT OF INCOME TAX
BRACKETS-
(1) Subsection (f) of section 1 is amended--
(A) by striking `1993' in paragraph (1) and inserting `1999',
(B) by striking `1992' in paragraph (3)(B) and inserting `1998',
and
(C) by striking paragraph (7).
(2) The following provisions are each amended by striking `1992' and
inserting `1998' each place it appears:
(G) Section 135(b)(2)(B)(ii).
(J) Section 221(g)(1)(B).
(K) Section 512(d)(2)(B).
(L) Section 513(h)(2)(C)(ii).
(M) Section 685(c)(3)(B).
(O) Section 911(b)(2)(D)(ii)(II).
(P) Section 2032A(a)(3)(B).
(Q) Section 2503(b)(2)(B).
(R) Section 2631(c)(1)(B).
(S) Section 4001(e)(1)(B).
(T) Section 4261(e)(4)(A)(ii).
(V) Section 6323(i)(4)(B).
(W) Section 6601(j)(3)(B).
(3) Subclause (II) of section 42(h)(6)(G)(i) is amended by striking
`1987' and inserting `1998'.
(4) Subparagraph (B) of section 132(f)(6) is amended by inserting before
the period `, determined by substituting `calendar year 1992' for `calendar
year 1998' in subparagraph (B) thereof'.
(5) Sections 468B(b)(1), 511(b)(1), 641(a), 641(d)(2)(A), and 685(d) are
each amended by striking `section 1(e)' each place it appears and inserting
`section 1(d)'.
(6) Sections 1(f)(2) and 904(b)(3)(E)(ii) are each amended by striking
`(d), or (e)' and inserting `or (d)'.
(7) Paragraph (1) of section 1(f) is amended by striking `(d), and (e)'
and inserting `and (d)'.
(d) EFFECTIVE DATE- The amendments made by this section shall apply to
taxable years beginning after December 31, 1999.
(e) SECTION 15 NOT TO APPLY- No amendment made by this section shall be
treated as a change in a rate of tax for purposes of sec tion 15 of the Internal Revenue
Code of 1986.
SEC. 6. REPEAL OVER 10 YEARS OF CAPITAL GAINS TAX ON INDIVIDUALS.
(a) IN GENERAL- Part I of subchapter P of chapter 1 (relating to treatment
of capital gains) is amended by adding at the end the following new
section:
`SEC. 1203. EXCLUSION OF CERTAIN AMOUNTS OF NET CAPITAL GAIN OF
INDIVIDUALS.
`(a) GENERAL RULE- In the case of an individual, gross income shall not
include an amount equal to the applicable percentage of the net capital gain
of the taxpayer for the taxable year.
`(b) APPLICABLE PERCENTAGE- For purposes of subsection (a), the term
`applicable percentage' means the percentage determined under the following
table:
`For taxable years beginning
in calendar year--
The applicable percentage is--
2000
10
2001
20
2002
30
2003
40
2004
50
2005
60
2006
70
2007
80
2009
90
2010 and thereafter
100.'
(b) CONFORMING AMENDMENTS-
(1) Section 1222 is amended by adding at the end the following new
sentence:
`Determinations under this section shall be made before the application of
section 1203.'
(2) The table of sections for part I of subchapter P of chapter 1 is
amended by adding at the end the following new item:
`Sec. 1203. Exclusion of certain amounts of net capital gain of individuals.'
(c) EFFECTIVE DATE- The amendments made by this section shall apply to
taxable years beginning after December 31, 1999.
SEC. 7. REPEAL OF EXCISE TAX ON VACCINES. 3> < p>
(a) IN GENERAL- Subchapter C of chapter 32 (relating to certain vaccines)
is hereby repealed.
(b) CONFORMING AMENDMENTS-
(1) Subsection (a) of section 4121 is amended by striking `In the case
of the tax imposed by section
4131, paragraphs (3), (4), and (5) shall not apply and paragraph (2)
shall apply only if the use of the exported vaccine meets such requirements
as the Secretary may by regulations prescribe.'.
(2) Paragraph (2) of section 6416(b) is amended by striking the last
sentence.
(3) The table of subchapters for chapter 32 is amended by striking the
item relating to subchapter C.
(c) EFFECTIVE DATE- The amendments made by this section shall take effect
on January 1, 2000.
SEC. 8. REPEAL OF EXCISE TAX ON SPORT FISHIN G EQ UIPMENT.
(a) IN GENERAL- Subchapter D of chapter 32 (relating to recreational
equipment) is amended to read as follows:
`Subchapter D--Bows and Arrows
`Sec. 4161. Imposition of tax.
`SEC. 4161. IMPOSITION OF
TAX.
`(1) IN GENERAL- There is hereby imposed on the sale by the
manufacturer, producer, or importer of any bow which has a draw weight of 10
pounds or more, a tax equal to 11 percent of the price for which so
sold.
`(2) PARTS AND ACCESSORIES- There is hereby imposed upon the sale by the
manufacturer, producer, or importer--
`(A) of any part of accessory suitable for inclusion in or attachment
to a bow described in paragraph (1), and
`(B) of any quiver suitable for use with arrows described in
subsection (b), a tax equivalent to 11 pe rcent of the price for which
so sold.
`(b) ARROWS- There is hereby imposed on the sale by the manufacturer,
producer, or importer of any shaft, point, nock, or vane of a type used in the
manufacture of any arrow which after its assembly--
`(1) measures 18 inches overall or more in length, or
`(2) measures less than 18 inches overall in length but is suitable for
use with a bow described in subsection (a)(1), a tax equal to 12.4 perce nt of the price for which so
sold.
`(c) TREATMENT OF CERTAIN RESALES-
`(A) the manufacturer, producer, or importer sells any article taxable
under section 4161(a) to any person,
`(B) the constructive sale price rules of section 4216(b) do not apply
to such sale, and
`(C) such person (or any other person) sells such article to a related
person with respect to the manufacturer, producer, or importer,
then such related person shall be liable for tax under section 4161 in the same manner as if such
related person were the manufacturer of the article.
`(2) CREDIT FOR TAX PREVIOUSLY PAID- If --
`(A) tax is imposed on the
s ale of any article by reason of paragraph (1), and
`(B) the related person establishes the amount of the tax which was
paid on t he sale described
in paragraph (1)(A), the amount of the tax so paid shall be al lowed as a credit against the
tax imposed by reason o f
paragraph (1).
`(3) RELATED PERSON- For purposes of this subsection, the term `related
person' has the meaning given such term by section 465(b)(3)(C).
`(4) REGULATIONS- Except to the extent provided in regulations, rules
similar to the rules of this subsection shall also apply in cases (not
described in paragraph (1)) in which intermediaries or other devices are
used for purposes of reducing the amount of the tax imposed by section 4161(a).'
(b) CLERICAL AMENDMENT- The item relating to subchapter D in the table of
subchapters for chapter 32 is amended to read as follows:
`Subchapter D. Bows and arrows.'
(c) EFFECTIVE DATE- The amendments made by this section shall take effect
on January 1, 2000.
SEC. 9. REPEAL OF 1993 INCOME TAX INCREASE ON SOCIAL SECURITY BENEFITS.
(a) IN GENERAL- Paragraph (2) of section 86(a) (relating to social
security and tier 1 railroad retirement benefits) is amended by adding at the
end the following new sentence:
`This paragraph shall not apply to any taxable year beginning after
December 31, 1999.'
(b) CONFORMING AMENDMENTS-
(1) Paragraph (3) of section 871(a) is amended by striking `85 percent'
in subparagraph (A) and inserting `50 percent'.
(2)(A) Subparagraph (A) of section 121(e)(1) of the Social Security
Amendments of 1983 (Public Law 98-21) is amended--
(i) by striking `(A) There' and inserting `There';
(ii) by striking `(i)' immediately following `amounts equivalent to';
and
(iii) by striking `, less (ii)' and all that follows and inserting a
period.
(B) Paragraph (1) of section 121(e) of such Act is amended by striking
subparagraph (B).
(C) Paragraph (3) of section 121(e) of such Act is amended by striking
subparagraph (B) and by redesignating subparagraph (C) as subparagraph
(B).
(D) Paragraph (2) of section 121(e) of such Act is amended in the first
sentence by striking `paragraph (1)(A)' and inserting `paragraph (1)'.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to
taxable years beginning after December 31, 1999.
SEC. 10. REPEAL OF DOUBLE TAXATION ON INTEREST AND DIVIDENDS.
(a) IN GENERAL- Part III of subchapter B of chapter 1 (relating to amounts
specifically excluded from gross income) is amended by inserting after section
115 the following new section:
`SEC. 116. EXCLUSION OF DIVIDENDS AND INTEREST RECEIVED BY INDIVIDUALS.
`(a) EXCLUSION FROM GROSS INCOME- Gross income does not include dividends
and interest received during the taxable year by an individual.
`(b) CERTAIN DIVIDENDS EXCLUDED- Subsection (a) shall not apply to any
dividend from a corporation which, for the taxable year of the corporation in
which the distribution is made, or for the next preceding taxable year of the
corporation, is a corporation exempt from tax under section 501 ( relating to certain charitable,
etc., organization) or section 521 (relating to farmers' cooperative
associations).
`(c) SPECIAL RULES- For purposes of this section--
`(1) EXCLUSION NOT TO APPLY TO CAPITAL GAIN DIVIDENDS FROM REGULATED
INVESTMENT COMPANIES AND REAL ESTATE INVESTMENT TRUSTS-
`For treatment of capital gain dividends, see sections 854(a) and
857(c).
`(2) CERTAIN NONRESIDENT ALIENS INELIGIBLE FOR EXCLUSION- In the case of
a nonresident alien individual, subsection (a) shall apply only--
`(A) in determining the tax imposed for the tax able year pursuant to section
871(b)(1) and only in respect of dividends and interest which are
effectively connected with the conduct of a trade or business within the
United States, or
`(B) in determining the tax imposed for the tax able year pursuant to section
877(b).
`(3) DIVIDENDS FROM EMPLOYEE STOCK OWNERSHIP PLANS- Subsection (a) shall
not apply to any dividend described in section 404(k).'.
(b) CONFORMING AMENDMENTS-
(1)(A) Subparagraph (A) of section 135(c)(4) is amended by inserting
`116,' before `137'.
(B) Subsection (d) of section 135 is amended by redesignating paragraph
(4) as paragraph (5) and by inserting after paragraph (3) the following new
paragraph:
`(4) COORDINATION WITH SECTION 116- This section shall be applied before
section 116.'.
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