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[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H. Res. 467 Engrossed in House (EH)]

                 In the House of Representatives, U.S.,

                                                        April 11, 2000.
Whereas on February 7, 2000, President Clinton and Vice President Gore submitted 
        a budget for fiscal year 2001 that raises taxes and fees on working 
        families by $116 billion over 5 years, creates 84 new Federal programs, 
        places Government spending increases on auto-pilot, and fails to offer 
        any serious proposal to strengthen Social Security or Medicare;
Whereas over the next decade the Clinton-Gore budget would spend $1.3 trillion 
        on bigger Government--consuming 70 percent of the projected $1.9 
        trillion in budget surpluses--thus spending more for the Federal 
        bureaucracy, and less for the American family;
Whereas as part of the $116 billion in tax and fee increases--

    (1) the President proposes to raise taxes by $12.8 billion on the 
insurance products which Americans rely on to protect their families, 
homes, and businesses;

    (2) the President proposes a stealth tax on our children by raising the 
death tax by $3.5 billion;

    (3) the President asks us to increase taxes on energy by $1.5 billion 
at a time of rising energy prices and increasing dependence on foreign oil; 
and

    (4) the President wants to raise Medicare premiums and other health 
care costs by $3.2 billion at the very time we are trying to insure our 
seniors' health security by preserving and protecting Medicare; and

Whereas the President's solution is to take hard-earned money and send it to 
        Washington where politicians can spend it: Now, therefore, be it
    Resolved, That it is the sense of the House of Representatives that--
            (1) despite having successfully balanced the budget and created 
        budget surpluses;
            (2) despite having protected social security and restored the 
        integrity of the Social Security Trust Fund;
            (3) despite the fact that in 1999 governments at all levels 
        collected $9,562 in taxes for every man, woman and child;
            (4) despite the fact our tax burden is at 20.0 percent of gross 
        domestic product--a post-World War II record high; and
            (5) despite the fact that our oversight activities have identified 
        billions of taxpayer's dollars that are subject to waste, fraud and 
        abuse,
the Congress should support the adoption of the package of tax and user fee 
increases proposed by the Clinton/Gore administration in their fiscal year 2001 
budget, as reestimated by the Joint Committee on Taxation, and as outlined 
below.
      

                     PROPOSED TAX AND FEE INCREASES
                          (Millions of dollars)
------------------------------------------------------------------------
                                                               2000-05
------------------------------------------------------------------------
 
I. PROPOSED TAX INCREASES
 
A. Corporate Tax Provisions
  1. Five corporate tax provisions with general application        2,340
  2. Require accrual of time value element on forward sale            41
   of corporate stock......................................
  3. Modify treatment of ESOP as S corporation shareholder.          169
  4. Limit dividend treatment for payments on self-                   10
   amortizing stock........................................
  5. Prevent serial liquidations of U.S. subsidiaries of              43
   foreign corporations....................................
  6. Prevent capital gains avoidance through basis shift             270
   transactions involving foreign shareholders.............
  7. Prevent mismatching of deductions and income                    229
   inclusions in transactions with related foreign persons.
  8. Prevent duplication or acceleration of loss through              93
   assumption of liabilities...............................
  9. Amend 80/20 company rules.............................          167
  10. Modify corporate-owned life insurance (``COLI'')             2,026
   rules...................................................
  11. Increase depreciation life by service term of tax-              66
   exempt use property leases..............................
B. Financial Products
  1. Require cash-method banks to accrue interest on short-           76
   term obligations........................................
  2. Require current accrual of market discount by accrual            52
   method taxpayers........................................
  3. Modify and clarify certain rules relating to debt-for-          136
   debt exchanges..........................................
  4. Modify and clarify straddle rules.....................           95
  5. Provide generalized rules for all income-stripping               65
   transactions............................................
  6. Require ordinary treatment for options dealers and               93
   commodities dealers.....................................
  7. Prohibit tax deferral on contributions of appreciated           NR<SUP>1</SUP>
   property to swap funds..................................
C. Provisions Affecting Corporations and Pass-Through
 Entities
  1. Conform control test for tax-free incorporations,                86
   distributions, and reorganizations......................
  2. Treat receipt of tracking stock as property...........          477
  3. Require consistent treatment and provide basis                  145
   allocation rules for transfers of intangibles in certain
   nonrecognition transactions.............................
  4. Modify tax treatment of certain reorganizations in              283
   which portfolio interests in stock disappear............
  5. Clarify definition of nonqualified preferred stock....           73
  6. Clarify rules for payment of estimated taxes for                120
   certain deemed asset sales..............................
  7. Modify treatment of transfers to creditors in divisive           46
   reorganizations.........................................
  8. Provide mandatory basis adjustments if partners have            159
   significant built-in loss in partnership property.......
  9. Modify treatment of closely-held REITs................           45
  10. Apply RIC excise tax to undistributed profits of                 4
   REITs...................................................
  11. Allow RICs a dividends paid deduction for redemptions        1,911
   only if the redemption represents a contraction in the
   RIC.....................................................
  12. Require REMICs to be secondarily liable for the tax             69
   liability of REMIC residual interest holders............
  13. Deny change in method treatment in tax-free                     25
   transactions............................................
  14. Deny deduction for punitive damages..................          233
  15. Repeal the lower-of-cost-or-market inventory                 2,032
   accounting method.......................................
  16. Disallow interest on debt allocable to tax-exempt               87
   obligations.............................................
  17. Capitalization of commissions by mutual fund                   461
   distributors............................................
D. Cost Recovery Provisions
  1. Provide consistent amortization periods for                     969
   intangibles.............................................
  2. Establish specific class lives for utility grading              307
   costs...................................................
  3. Extend the present-law intangibles amortization                 245
   provisions to acquisitions of sports franchises.........
E. Insurance Provisions
  1. Require recapture of policyholder surplus accounts....        1,622
  2. Modify rules for capitalizing policy acquisition costs        5,084
   of insurance companies..................................
  3. Increase the proration percentage for property and              323
   casualty insurance companies............................
  4. Modify rules that apply to sales of life insurance              140
   contracts...............................................
  5. Modify qualification rules for tax-exempt property and           87
   casualty insurance companies............................
F. Tax-Exempt Organization Provisions
  1. Subject investment income of trade associations to tax          730
  2. Penalty for failure to file Form 5227.................            7
G. Estate and Gift Tax Provisions
  1. Restore phaseout of unified credit for large estates..          430
  2. Require consistent valuation for estate and income tax           50
   purposes................................................
  3. Require basis allocation for part-sale, part-gift                 5
   transactions............................................
  4. Eliminate the stepped-up basis in community property            229
   owned by surviving spouse...............................
  5. Require that qualified terminable interest property               8
   for which a marital deduction is allowed be included in
   the surviving spouse's estate...........................
  6. Eliminate non-business valuation discounts............        2,985
  7. Eliminate gift tax exemption for personal residence              28
   trusts..................................................
  8. Eliminate the Crummey rule and modify requirements for           45
   annual exclusion gifts..................................
H. Pension Provisions
  1. Increase elective withholding rate for nonperiodic               60
   distributions from deferred compensation plans..........
  2. Increase section 4973 excise tax on excess IRA                   39
   contributions...........................................
  3. Impose limitation on prefunding of welfare benefits...          873
  4. Subject signing bonuses to employment taxes...........           27
  5. Clarify employment tax treatment of choreworkers                RS<SUP>2</SUP>
   employed by State welfare agencies......................
  6. Prohibit IRAs from investing in foreign sales                   126
   corporations............................................
I. Compliance Provisions
  1. Modify the substantial understatement penalty for                15
   large corporations......................................
  2. Repeal exemption for withholding on certain gambling             31
   winnings................................................
  3. Require information reporting for private separate              NR<SUP>1</SUP>
   accounts................................................
  4. Increase penalties for failure to file correct                   47
   information returns.....................................
J. Miscellaneous Revenue-Increasing Provisions
  1. Modify deposit requirement for Federal Unemployment           1,367
   Tax Act (``FUTA'')......................................
  2. Reinstate Oil Spill Liability Trust Fund excise tax           1,022
   and increase trust fund ceiling to $5 billion (through 9/
   30/10)..................................................
  3. Repeal percentage depletion for non-fuel minerals               410
   mined on Federal and formerly Federal lands.............
  4. Impose excise tax on purchase of structured                      12
   settlements.............................................
  5. Require taxpayers to include rental income of                    75
   residence in income without regard to period of rental..
  6. Eliminate installment payment of heavy vehicle use tax          320
  7. Require recognition of gain from the sale of a                   45
   principal residence if acquired in a like-kind exchange
   within 5 years of the sale..............................
K. International Provisions
  1. Require reporting of payments to, and restrict tax              100
   benefits for income flowing through, identified tax
   havens..................................................
  2. Modify treatment of built-in losses and other                   524
   attribute trafficking...................................
  3. Simplify taxation of property that no longer produces           NR<SUP>1</SUP>
   income effectively connected with a U.S. trade or
   business................................................
  4. Impose mark-to-market tax on individuals who                    500
   expatriate..............................................
  5. Expand U.S.-effectively connected income rules to                26
   include more foreign-source income......................
  6. Limit basis step-up for imported pensions.............           50
  7. Replace sales-source rules with activity-based rules..        7,828
  8. Modify rules relating to foreign oil and gas                  1,151
   extraction income.......................................
  9. Recapture overall foreign losses when controlled                 18
   foreign corporation stock is disposed...................
  10. Modify foreign office material participation                    25
   exception applicable to certain inventory sales.........
L. Other Provisions Requiring Amendment of the Internal
 Revenue Code
  1. Hazardous Substance Superfund Taxes:
    a. Reinstate environmental tax imposed on corporate            3,600
     taxable income and deposited in the Hazardous
     Substance Superfund...................................
    b. Reinstate excise taxes deposited in the Hazardous           3,853
     Substance Superfund...................................
  2. Convert a portion of the excise taxes deposited in the        6,667
   Airport and Airway Trust Fund to cost-based user fees
   (Administration's estimate).............................
  3. Increase excise taxes on tobacco products.............       37,313
  4. Repeal harbor maintenance excise tax and authorize           -2,742
   imposition of cost-based harbor services user fee.......
  5. Accelerate rum excise tax coverover payments to Puerto           --
   Rico and the U.S. Virgin Islands........................
  6. Restore Premiums for United Mine Workers of American             43
   benefit fund............................................
                                                            ------------
Total: Provisions increasing revenue.......................       88,946
 
II. PROPOSED FEE INCREASES
 
A. Proposals for Discretionary User Fees
1. Offsetting collections deposited in appropriation
 accounts
Department of Agriculture:
  Food Safety Inspection Service fees......................        3,098
  Animal and Plant Health Inspection Service...............           55
  Grain Inspection, Packers and Stockyards Administration..          115
Department of Commerce:
  National Oceanic and Atmospheric Administration,                    70
   Navigational assistance fees............................
  Fisheries management fees................................          100
Department of Health and Human Services:
  Food and Drug Administration fees........................           95
Health Care Financing Administration fee proposals:
  Managed care application and renewal fees................          105
  Provider initial certification fees......................           65
  Provider recertification fees............................          250
  Paper claims submission fees.............................          415
  Duplicate and unprocessable claims fees..................          265
  Increase Medicare+Choice fees............................          646
  Nursing home criminal abuse registry fee.................           20
Department of the Interior:
  User fees on Outer Continental Shelf lands...............           50
Department of Justice:
  Hart-Scott Rodino pre-merger filing fees.................          190
Department of Transportation:
  Coast Guard, navigational services fees..................        2,826
  Federal Railroad Administration, rail safety inspection            515
   fees....................................................
  Hazardous materials transportation safety fees...........           95
  Surface Transportation Board fees........................           85
Department of the Treasury:
  Customs, automation modernization fee....................        1,050
Federal Trade Commission:
  Hart-Scott Rodino pre-merger filing fees.................          190
National Transportation Safety Board:
  Commercial accident investigation fees...................           50
2. Offsetting collections deposited in receipt accounts
Department of Justice:
  Immigration premium processing fee.......................           85
  Increase inspection user fees............................          835
Department of Transportation:
  Pipeline safety fees.....................................           59
Environmental Protection Agency:
  Pesticide registration fees..............................           16
  Pre-manufacture notice (PMN) fees........................           36
Nuclear Regulatory Commission:
  Extend Nuclear Regulatory Commission user fees...........        1,475
                                                            ------------
    Subtotal, proposals for discretionary user fees........       12,856
 
B. Proposed Fee Increases to Offset Mandatory Spending
 
1. Offsetting collections deposited in appropriation
 accounts
Department of Agriculture:
  Federal crop insurance...................................           69
Department of Labor:
  Implement alien labor certification fees.................          626
Federal Emergency Management Agency:
  Flood map license fee for flood map modernization........          546
2. Offsetting collections deposited in receipt accounts
Department of Agriculture:
  Recreation and entrance fees.............................          162
  Concession, land use, right of way, and filming permits..           52
Department of Health and Human Services:
  Medicare premiums........................................        1,446
Department of the Interior:
  Recreation and entrance fees.............................          297
  Filming and special use permits fees.....................           19
  Hardrock mining production fees..........................           86
Department of the Treasury:
  Customs, extend conveyance/passenger fee.................          889
  Customs, extend merchandise processing fee...............        2,095
                                                            ------------
    Subtotal user fee proposals to offset mandatory                6,287
     spending..............................................
                                                            ============
Total user fee proposals...................................       19,143
------------------------------------------------------------------------
<SUP>1</SUP>Negligible or no revenue effect.
<SUP>2</SUP>Requires specification.

            Attest:

                                                                          Clerk.
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