I 

113TH CONGRESS 

1ST SESSION H. R. 1295 

To amend the Internal Revenue Code of 1986 to repeal the excise tax 

on medical devices, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 20, 2013 

Mr. MAFFEI (for himself and Mr. POLIS) introduced the following bill; which 

was referred to the Committee on Ways and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to repeal 

the excise tax on medical devices, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Medical Device Tax 

5 Elimination Act’’. 

6 SEC. 2. REPEAL OF MEDICAL DEVICE EXCISE TAX. 

7 (a) IN GENERAL.—Chapter 32 of the Internal Rev8 enue Code of 1986 is amended by striking subchapter E. 

9 (b) CONFORMING AMENDMENTS.— 


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1 (1) Subsection (a) of section 4221 of such Code 

2 is amended by striking the last sentence. 

3 (2) Paragraph (2) of section 6416(b) of such 

4 Code is amended by striking the last sentence. 

5 (c) CLERICAL AMENDMENT.—The table of sub6 chapters for chapter 32 of such Code is amended by strik7 ing the item relating to subchapter E. 

8 (d) EFFECTIVE DATE.—The amendments made by 

9 this section shall apply to sales after the date of the enact10 ment of this Act. 

11 SEC. 3. LIMITATION ON SECTION 199 DEDUCTION ATTRIB12 UTABLE TO OIL, NATURAL GAS, OR PRIMARY 

13 PRODUCTS THEREOF. 

14 (a) DENIAL OF DEDUCTION.—Paragraph (4) of sec15 tion 199(c) of the Internal Revenue Code of 1986 is 

16 amended by adding at the end the following new subpara17 graph: 

18 ‘‘(E) SPECIAL RULE FOR CERTAIN OIL

19 AND GAS INCOME.—In the case of any taxpayer 

20 who is a major integrated oil company (as de21 fined in section 167(h)(5)(B)) for the taxable 

22 year, the term ‘domestic production gross re23 ceipts’ shall not include gross receipts from the 

24 production, transportation, or distribution of 


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1 oil, natural gas, or any primary product (within 

2 the meaning of subsection (d)(9)) thereof.’’. 

3 (b) EFFECTIVE DATE.—The amendment made by 

4 this section shall apply to taxable years beginning after 

5 December 31, 2012. 

6 SEC. 4. PROHIBITION ON USING LAST-IN, FIRST-OUT AC7 COUNTING FOR MAJOR INTEGRATED OIL 

8 COMPANIES. 

9 (a) IN GENERAL.—Section 472 of the Internal Rev10 enue Code of 1986 is amended by adding at the end the 

11 following new subsection: 

12 ‘‘(h) MAJOR INTEGRATED OIL COMPANIES.—Not13 withstanding any other provision of this section, a major 

14 integrated oil company (as defined in section 

15 167(h)(5)(B)) may not use the method provided in sub16 section (b) in inventorying of any goods.’’. 

17 (b) EFFECTIVE DATE AND SPECIAL RULE.— 

18 (1) IN GENERAL.—The amendment made by 

19 subsection (a) shall apply to taxable years beginning 

20 after December 31, 2012. 

21 (2) CHANGE IN METHOD OF ACCOUNTING.—In 

22 the case of any taxpayer required by the amendment 

23 made by this section to change its method of ac24 counting for its first taxable year beginning after 

25 December 31, 2012— 


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1 (A) such change shall be treated as initi2 ated by the taxpayer, 

3 (B) such change shall be treated as made 

4 with the consent of the Secretary of the Treas5 ury, and 

6 (C) the net amount of the adjustments re7 quired to be taken into account by the taxpayer 

8 under section 481 of the Internal Revenue Code 

9 of 1986 shall be taken into account ratably over 

10 a period (not greater than 8 taxable years) be11 ginning with such first taxable year. 

12 SEC. 5. MODIFICATIONS OF FOREIGN TAX CREDIT RULES 

13 APPLICABLE TO MAJOR INTEGRATED OIL 

14 COMPANIES WHICH ARE DUAL CAPACITY 

15 TAXPAYERS. 

16 (a) IN GENERAL.—Section 901 of the Internal Rev17 enue Code of 1986 is amended by redesignating subsection 

18 (n) as subsection (o) and by inserting after subsection (m) 

19 the following new subsection: 

20 ‘‘(n) SPECIAL RULES RELATING TO MAJOR INTE21 GRATED OIL COMPANIES WHICH ARE DUAL CAPACITY

22 TAXPAYERS.— 

23 ‘‘(1) GENERAL RULE.—Notwithstanding any 

24 other provision of this chapter, any amount paid or 

25 accrued by a dual capacity taxpayer which is a 


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1 major integrated oil company (as defined in section 

2 167(h)(5)(B)) to a foreign country or possession of 

3 the United States for any period shall not be consid4 ered a tax— 

5 ‘‘(A) if, for such period, the foreign coun6 try or possession does not impose a generally 

7 applicable income tax, or 

8 ‘‘(B) to the extent such amount exceeds 

9 the amount (determined in accordance with reg10 ulations) which— 

11 ‘‘(i) is paid by such dual capacity tax12 payer pursuant to the generally applicable 

13 income tax imposed by the country or pos14 session, or 

15 ‘‘(ii) would be paid if the generally ap16 plicable income tax imposed by the country 

17 or possession were applicable to such dual 

18 capacity taxpayer. 

19 Nothing in this paragraph shall be construed to 

20 imply the proper treatment of any such amount 

21 not in excess of the amount determined under 

22 subparagraph (B). 

23 ‘‘(2) DUAL CAPACITY TAXPAYER.—For pur24 poses of this subsection, the term ‘dual capacity taxVerDate Mar 15 2010 02:55 Mar 26, 2013 Jkt 029200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H1295.IH H1295

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1 payer’ means, with respect to any foreign country or 

2 possession of the United States, a person who— 

3 ‘‘(A) is subject to a levy of such country or 

4 possession, and 

5 ‘‘(B) receives (or will receive) directly or 

6 indirectly a specific economic benefit (as deter7 mined in accordance with regulations) from 

8 such country or possession. 

9 ‘‘(3) GENERALLY APPLICABLE INCOME TAX.— 

10 For purposes of this subsection— 

11 ‘‘(A) IN GENERAL.—The term ‘generally 

12 applicable income tax’ means an income tax (or 

13 a series of income taxes) which is generally im14 posed under the laws of a foreign country or 

15 possession on income derived from the conduct 

16 of a trade or business within such country or 

17 possession. 

18 ‘‘(B) EXCEPTIONS.—Such term shall not 

19 include a tax unless it has substantial applica20 tion, by its terms and in practice, to— 

21 ‘‘(i) persons who are not dual capacity 

22 taxpayers, and 

23 ‘‘(ii) persons who are citizens or resi24 dents of the foreign country or posses25 sion.’’. 


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1 (b) EFFECTIVE DATE.— 

2 (1) IN GENERAL.—The amendments made by 

3 this section shall apply to taxes paid or accrued in 

4 taxable years beginning after December 31, 2012. 

5 (2) CONTRARY TREATY OBLIGATIONS

6 UPHELD.—The amendments made by this section 

7 shall not apply to the extent contrary to any treaty 

8 obligation of the United States. 

Æ 


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