I 
113TH CONGRESS 
1ST SESSION 
H. R. 880 
To amend the Internal Revenue Code of 1986 to impose a tax on certain 
trading transactions. 
IN THE HOUSE OF REPRESENTATIVES 
FEBRUARY 28, 2013 
Mr. DEFAZIO (for himself, Ms. SLAUGHTER, Ms. NORTON, Mr. SCOTT of Vir-
ginia, Mr. CAPUANO, Ms. PINGREE of Maine, Mr. MCGOVERN, Mr. CON-
YERS, Mr. HUFFMAN, Mr. GRIJALVA, Mr. WELCH, Ms. SCHAKOWSKY, 
Mrs. NAPOLITANO, Ms. EDWARDS, Mr. SARBANES, Mr. MICHAUD, Ms. 
BROWN of Florida, Mr. ELLISON, Ms. CHU, Ms. DELAURO, and Mr. 
BLUMENAUER) 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 impose 
a tax on certain trading transactions. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Wall Street Trading 
and Speculators Tax Act’’. 
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SEC. 2. TRANSACTION TAX. 
(a) IN GENERAL.—Chapter 36 of the Internal Rev-
enue Code of 1986 is amended by inserting after sub-
chapter B the following new subchapter: 
‘‘Subchapter C—Tax on Trading Transactions 
‘‘Sec. 4475. Tax on trading transactions. 
‘‘SEC. 4475. TAX ON TRADING TRANSACTIONS. 
‘‘(a) IMPOSITION OF TAX.—There is hereby imposed 
a tax on each covered transaction with respect to any secu-
rity. 
‘‘(b) RATE OF TAX.—The tax imposed under sub-
section (a) with respect to any covered transaction shall 
be 0.03 percent of the specified base amount with respect 
to such covered transaction. 
‘‘(c) SPECIFIED BASE AMOUNT.—For purposes of 
this section, the term ‘specified base amount’ means— 
‘‘(1) except as provided in paragraph (2), the 
fair market value of the security (determined as of 
the time of the covered transaction), and 
‘‘(2) in the case of any payment described in 
subsection (h), the amount of such payment. 
‘‘(d) COVERED TRANSACTION.—For purposes of this 
section, the term ‘covered transaction’ means— 
‘‘(1) except as provided in paragraph (2), any 
purchase if— 
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‘‘(A) such purchase occurs or is cleared on 
a facility located in the United States, or 
‘‘(B) the purchaser or seller is a United 
States person, and 
‘‘(2) any transaction with respect to a security 
described in subparagraph (D), (E), or (F) of sub-
section (e)(1), if— 
‘‘(A) such security is traded or cleared on 
a facility located in the United States, or 
‘‘(B) any party with rights under such se-
curity is a United States person. 
‘‘(e) SECURITY AND OTHER DEFINITIONS.—For pur-
poses of this section— 
‘‘(1) 
IN
GENERAL.—The 
term 
‘security’ 
means— 
‘‘(A) any share of stock in a corporation, 
‘‘(B) any partnership or beneficial owner-
ship interest in a partnership or trust, 
‘‘(C) any note, bond, debenture, or other 
evidence of indebtedness, 
‘‘(D) any evidence of an interest in, or a 
derivative financial instrument with respect to, 
any security or securities described in subpara-
graph (A), (B), or (C), 
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‘‘(E) any derivative financial instrument 
with respect to any currency or commodity, and 
‘‘(F) any notional principal contract. 
‘‘(2) DERIVATIVE
FINANCIAL
INSTRUMENT.— 
The term ‘derivative financial instrument’ includes 
any option, forward contract, futures contract, or 
any similar financial instrument. 
‘‘(3) NOTIONAL PRINCIPAL CONTRACT.—Except 
as otherwise provided by the Secretary, the term ‘no-
tional principal contract’ means any financial instru-
ment which requires two or more payments at speci-
fied intervals calculated by reference to a specified 
index upon one or more notional principal amounts. 
An amount shall not fail to be treated as a payment 
described in the preceding sentence merely because 
such amount is fixed on one date and paid or other-
wise taken into account on a different date. 
‘‘(4) SPECIFIED
INDEX.—The term ‘specified 
index’ means any 1 or more of any combination of— 
‘‘(A) a fixed rate, price, or amount, or 
‘‘(B) a variable rate, price, or amount,
‘‘(C) any index based on any objectively 
determinable information (including the occur-
rence or nonoccurrence of any event) which is 
not within the control of any of the parties to 
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the instrument and is not unique to any of the 
parties’ circumstances, and 
‘‘(D) any other index as the Secretary may 
prescribe. 
‘‘(5) TREATMENT OF EXCHANGES.— 
‘‘(A) IN GENERAL.—An exchange shall be 
treated as the sale of the property transferred 
and a purchase of the property received by each 
party to the exchange. 
‘‘(B) CERTAIN DEEMED EXCHANGES.—In 
the case of a distribution treated as an ex-
change for stock under section 302 or 331, the 
corporation making such distribution shall be 
treated as having purchased such stock for pur-
poses of this section. 
‘‘(f) EXCEPTIONS.— 
‘‘(1) EXCEPTION FOR INITIAL ISSUES.—No tax 
shall be imposed under subsection (a) on any cov-
ered transaction with respect to the initial issuance 
of any security described in subparagraph (A), (B), 
or (C) of subsection (e)(1). 
‘‘(2) EXCEPTION FOR CERTAIN TRADED SHORT- 
TERM INDEBTEDNESS.—A note, bond, debenture, or 
other evidence of indebtedness which— 
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‘‘(A) is traded on a trading facility located 
in the United States, and 
‘‘(B) has a fixed maturity of not more 
than 100 days, 
shall not be treated as described in subsection 
(e)(1)(C). 
‘‘(3) EXCEPTION FOR SECURITIES LENDING AR-
RANGEMENTS.—No tax shall be imposed under sub-
section (a) on any covered transaction with respect 
to which gain or loss is not recognized by reason of 
section 1058. 
‘‘(g) BY WHOM PAID.— 
‘‘(1) IN GENERAL.—The tax imposed by this 
section shall be paid by— 
‘‘(A) in the case of a transaction which oc-
curs or is cleared on a facility located in the 
United States, such facility, and 
‘‘(B) in the case of a purchase not de-
scribed in subparagraph (A) which is executed 
by a broker (as defined in section 6045(c)(1)) 
which is a United States person, such broker. 
‘‘(2) SPECIAL
RULES
FOR
DIRECT, 
ETC., 
TRANSACTIONS.—In the case of any transaction to 
which paragraph (1) does not apply, the tax imposed 
by this section shall be paid by— 
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‘‘(A) in the case of a transaction described 
in subsection (d)(1)— 
‘‘(i) the purchaser if the purchaser is 
a United States person, and 
‘‘(ii) the seller if the purchaser is not 
a United States person, and 
‘‘(B) in the case of a transaction described 
in subsection (d)(2)— 
‘‘(i) the payor if the payor is a United 
States person, and 
‘‘(ii) the payee if the payor is not a 
United States person. 
‘‘(h) CERTAIN PAYMENTS TREATED AS SEPARATE 
TRANSACTIONS.—Except as otherwise provided by the 
Secretary, any payment with respect to a security de-
scribed in subparagraph (D), (E), or (F) of subsection 
(e)(1) shall be treated as a separate transaction for pur-
poses of this section, including— 
‘‘(1) any net initial payment, net final or termi-
nating payment, or net periodical payment with re-
spect to a notional principal contract (or similar fi-
nancial instrument), 
‘‘(2) any payment with respect to any forward 
contract (or similar financial instrument), and 
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‘‘(3) any premium paid with respect to any op-
tion (or similar financial instrument). 
‘‘(i) APPLICATION
TO
TRANSACTIONS
BY
CON-
TROLLED FOREIGN CORPORATIONS.— 
‘‘(1) IN GENERAL.—For purposes of this sec-
tion, a controlled foreign corporation shall be treated 
as a United States person. 
‘‘(2) SPECIAL RULES FOR PAYMENT OF TAX ON 
DIRECT, ETC., TRANSACTIONS.—In the case of any 
transaction which is a covered transaction solely by 
reason of paragraph (1) and which is not described 
in subsection (g)(1)— 
‘‘(A) PAYMENT BY UNITED STATES SHARE-
HOLDERS.—Any tax which would (but for this 
paragraph) be payable under subsection (g)(2) 
by the controlled foreign corporation shall, in 
lieu thereof, be paid by the United States 
shareholders of such controlled foreign corpora-
tion as provided in subparagraph (B). 
‘‘(B) PRO
RATA
SHARES.—Each such 
United States shareholder shall pay the same 
proportion of such tax as— 
‘‘(i) the stock which such United 
States shareholder owns (within the mean-
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ing of section 958(a)) in such controlled 
foreign corporation, bears to 
‘‘(ii) the stock so owned by all United 
States shareholders in such controlled for-
eign corporation. 
‘‘(C) DEFINITIONS.—For purposes of this 
subsection, the terms ‘United States share-
holder’ and ‘controlled foreign corporation’ have 
the meanings given such terms in sections 
951(b) and 957(a), respectively. 
‘‘(j) ADMINISTRATION.—The Secretary shall carry 
out this section in consultation with the Securities and Ex-
change Commission and the Commodity Futures Trading 
Commission. 
‘‘(k) GUIDANCE; REGULATIONS.—The Secretary 
shall— 
‘‘(1) provide guidance regarding such informa-
tion reporting concerning covered transactions as the 
Secretary deems appropriate, and 
‘‘(2) prescribe such regulations as are necessary 
or appropriate to prevent avoidance of the purposes 
of this section, including the use of non-United 
States persons in such transactions.’’. 
(b) CREDIT WITH RESPECT TO CERTAIN TAX-FA-
VORED ACCOUNTS TO OFFSET TRANSACTION TAX.— 
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(1) IN GENERAL.—Subpart C of part IV of sub-
chapter A of chapter 1 of such Code is amended by 
inserting after section 36B the following new sec-
tion: 
‘‘SEC. 36C. OFFSET FOR TRANSACTION TAX WITH RESPECT 
TO CERTAIN TAX-FAVORED ACCOUNTS. 
‘‘(a) IN GENERAL.—There shall be allowed as a cred-
it against the tax imposed by this subtitle for the taxable 
year an amount equal to 0.03 percent of the qualified tax- 
favored account contributions of the taxpayer for the tax-
able year. 
‘‘(b) QUALIFIED
TAX-FAVORED
ACCOUNT
CON-
TRIBUTIONS.—For purposes of this section, the term 
‘qualified tax-favored account contributions’ means, with 
respect to any taxable year, the sum of— 
‘‘(1) with respect to qualified retirement plans 
(as defined in section 4974(c)) of the taxpayer, the 
amount contributed to such plans for such taxable 
year to the extent that such contributions are allow-
able as a deduction or are excludable from gross in-
come (or, in the case of a Roth IRA (as defined in 
section 408A(b)), the amount contributed), 
‘‘(2) with respect to Archer MSAs of the tax-
payer, the amount allowed as a deduction under sec-
tion 220 for such taxable year, 
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‘‘(3) with respect to health savings accounts of 
the taxpayer, the amount allowed as a deduction 
under section 223 for such taxable year, plus 
‘‘(4) with respect to qualified tuition programs 
(as defined in section 529) and Coverdell education 
savings accounts (as defined in section 530) with re-
spect to which the taxpayer is the designated bene-
ficiary (or, in the case of a designated beneficiary 
with respect to whom another taxpayer is allowed a 
deduction under section 151, such other taxpayer in 
lieu of such designated beneficiary), the amount con-
tributed for such taxable year.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 1324(b)(2) of title 31, United 
States Code, is amended by inserting ‘‘, 36C’’ 
after ‘‘36B’’. 
(B) The table of sections for subpart C of 
part IV of subchapter A of chapter 1 of the In-
ternal Revenue Code of 1986 is amended by in-
serting before the item relating to section 37 
the following new item: 
‘‘Sec. 36C. Offset for transaction tax on contributions to certain tax-favored ac-
counts.’’. 
(c) INFORMATION REPORTING WITH RESPECT TO 
CONTROLLED FOREIGN CORPORATIONS.—Subparagraph 
(B) of section 6038(a)(1) is amended by inserting ‘‘and 
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transactions which are covered transactions for purposes 
of section 4475 by reason of the application of section 
4475(i)(1) to such corporation’’ before the semicolon at 
the end. 
(d) CLERICAL AMENDMENT.—The table of sub-
chapters for chapter 36 of the Internal Revenue Code of 
1986 is amended by inserting after the item relating to 
subchapter B the following new item: 
‘‘Subchapter C. Tax on trading transactions.’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to transactions after December 31, 
2013. 
Æ 
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