Jobs Friendly America Act

Summary: Jobs Friendly America Act - Amends the Internal Revenue Code to allow accelerated depreciation for equipment used by any corporation having a majority of its manufacturing equipment in the United States. 
Reduces corporate and individual capital gains rates. 
Repeals the deferral on earnings of controlled foreign corporations invested in excess passive assets.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Jobs Friendly America Act''.

SEC. 2. ACCELERATED DEPRECIATION FOR EQUIPMENT USED TO MANUFACTURE OR 
              DEVELOP PRODUCTS IN THE UNITED STATES.

    (a) In General.--Subparagraph (A) of section 168(e)(3) of the 
Internal Revenue Code of 1986 (relating to classification of property) 
is amended by striking ``and'' at the end of clause (i), by striking 
the period at the end of clause (ii) and inserting ``, and'', and by 
adding at the end the following new clause:
                            ``(iii) any tool of production of a 
                        qualifying corporation (as defined in 
                        subsection (i)(14)) used by such corporation to 
                        manufacture or develop products in the United 
                        States.''
    (b) Qualifying Corporation.--Subsection (i) of section 168 of such 
Code is amended by adding at the end the following new paragraph:
            ``(14) Qualifying corporation.--
                    ``(A) In general.--The term `qualifying 
                corporation' means any corporation having a majority of 
                its manufacturing equipment in the United States.
                    ``(B) Controlled groups.--For purposes of 
                subparagraph (A), all corporations which are members of 
                the same controlled group of corporations shall be 
                treated as 1 corporation. For purposes of the preceding 
                sentence, the term `controlled group of corporations' 
                has the meaning given such term by section 1563(a); 
                except that--
                            ``(i) `more than 10 percent' shall be 
                        substituted for `at least 80 percent' each 
                        place it appears in section 1563(a)(1), and
                            ``(ii) section 1563(b)(2) shall be applied 
                        without regard to subparagraph (C) thereof.''
    (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service after December 31, 1993.

SEC. 3. REDUCTION IN CORPORATE CAPITAL GAINS RATE.

    (a) General Rule.--Section 1201 of the Internal Revenue Code of 
1986 (relating to alternative tax for corporations) is amended by 
redesignating subsection (b) as subsection (c), and by striking 
subsection (a) and inserting the following:
    ``(a) General Rule.--If for any taxable year a qualifying 
corporation (as defined in section 168(i)(14)) has a net capital gain, 
then, in lieu of the tax imposed by section 11, 511, or 831(a) 
(whichever applies), there is hereby imposed a tax (if such tax is less 
than the tax imposed by such section) which shall consist of the sum 
of--
            ``(1) a tax computed on the taxable income reduced by the 
        net capital gain, at the same rates and in the same manner as 
        if this subsection had not been enacted, plus
            ``(2) a tax of 15 percent of the net capital gain.
    ``(b) Transitional Rule.--In the case of a taxable year which 
includes the date of the enactment of this paragraph, the amount of the 
net capital gain for purposes of subsection (a) shall not exceed the 
net capital gain determined by only taking into account gains and 
losses properly taken into account for the portion of the taxable year 
after such date.''
    (b) Technical Amendments.--
            (1) Clause (iii) of section 852(b)(3)(D) of such Code is 
        amended by striking ``65 percent'' and inserting ``85 
        percent''.
            (2) Paragraphs (1) and (2) of section 1445(e) of such Code 
        are each amended by striking ``35 percent'' and inserting ``15 
        percent''.
    (c) Effective Date.--The amendments made by this section shall 
apply to sales and exchanges occurring after the date of the enactment 
of this Act in taxable years ending after such date.

SEC. 4. REDUCTION IN INDIVIDUAL CAPITAL GAINS RATE.

    (a) General Rule.--Subsection (h) of section 1 of the Internal 
Revenue Code of 1986 (relating to maximum capital gains rate) is 
amended to read as follows:
    ``(h) Maximum Capital Gains Rate.--
            ``(1) In general.--If a taxpayer has a net capital gain for 
        any taxable year, then the tax imposed by this section shall 
        not exceed the sum of--
                    ``(A) a tax computed at the rates and in the same 
                manner as if this subsection had not been enacted on 
                the taxable income reduced by the net capital gain, 
                plus
                    ``(B) a tax equal to the sum of--
                            ``(i) 7.5 percent of so much of the net 
                        capital gain as does not exceed--
                                    ``(I) the maximum amount of taxable 
                                income to which the 15-percent rate 
                                applies under the table applicable to 
                                the taxpayer, reduced by
                                    ``(II) the taxable income to which 
                                subparagraph (A) applies, plus
                            ``(ii) 15 percent of the net capital gain 
                        in excess of the net capital gain to which 
                        clause (i) applies.
            ``(2) Transitional rule.--In the case of a taxable year 
        which includes the date of the enactment of this paragraph, the 
        amount of the net capital gain for purposes of paragraph (1) 
        shall not exceed the net capital gain determined by only taking 
        into account gains and losses properly taken into account for 
        the portion of the taxable year after such date.''
    (b) Technical Amendments.--
            (1) Paragraph (1) of section 170(e) of such Code is amended 
        by striking ``the amount of gain'' in the material following 
        subparagraph (B)(ii) and inserting ``13/28 (19/34 in the case 
        of a corporation) of the amount of gain''.
            (2)(A) The second sentence of section 7518(g)(6)(A) of such 
        Code is amended by striking ``28 percent (34 percent in the 
        case of a corporation)'' and inserting ``15 percent''.
            (B) The second sentence of section 607(h)(6)(A) of the 
        Merchant Marine Act, 1936, is amended by striking ``28 percent 
        (34 percent in the case of a corporation)'' and inserting ``15 
        percent''.
    (c) Effective Date.--The amendments made by this section shall 
apply to sales and exchanges occurring after the date of the enactment 
of this Act in taxable years ending after such date.

SEC. 5. REPEAL OF DEFERRAL ON FOREIGN EARNINGS.

    (a) In General.--Subparagraph (A) of section 956A(c)(1) of the 
Internal Revenue Code of 1986 is amended to read as follows:
                    ``(A) the average of the amounts of--
                            ``(i) passive assets, and
                            ``(ii) post-1993 foreign investments,
                held by such corporation as of the close of each 
                quarter of such taxable year, over.''
    (b) Post-1993 Foreign Investment.--Subsection (c) of section 956A 
of such Code is amended by redesignating paragraph (3) as paragraph (4) 
and by inserting after paragraph (2) the following new paragraph:
            ``(3) Post-1993 foreign investment.--For purposes of this 
        subsection, the term `post-1993 foreign investment' means any 
        asset (other than United States property as defined in section 
        956) acquired by the controlled foreign corporation after 
        December 31, 1993.''
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years of controlled foreign corporations ending after 
December 31, 1993.