SEC. 2. FINDINGS AND PURPOSE.
(a) FINDINGS.—The Congress finds that—
(1) according to the Centers for Disease Con-
trol, an estimated 34,000 Americans die from fire-
arm injuries each year, including 25,000 from hand-
gun violence;
(2) firearms rank as the 8th leading cause of
death in the United States and less than 5 percent
of fatal shootings are unintentional;
(3) the National Center for Health Statistics
reported in March 1993 that, among Americans age
15 through 24, firearms are the cause of more
deaths than all natural causes combined;
(4) from 1979 to 1989, the firearm homicide
rate among children age 15 through 19 increased 61
percent, while the nonfirearm homicide rate fell 29
percent;
(5) more than 135,000 students carry hand-
guns to school everyday, and an additional 270,000
students have carried a firearm to school at least
once;
(6) the United States leads industrialized na-
tions in the percentage of households with firearms
and the number of homicides with firearms;
(7) according to the Centers for Disease Con-
trol, the estimated lifetime costs for firearm injuries
that occurred in 1985 will be $14,400,000,000;
(8) according to the 1991 Advisory Council on
Social Security, the overall annual cost of firearms
injury to the health care system in the United States
is more than $4,000,000,000;
(9) public funds pay for an estimated 85 per-
cent of the cost of hospitalization for firearm inju-
ries, excluding professional fees and the cost of am-
bulance, physical therapy, and other rehabilitative
services;
(10) the indirect costs of firearm-related inju-
ries, such as disability payments, legal fees, and lost
work time, are estimated to be 2 times the estimated
annual direct cost of firearm injury;
(11) more than 280,000 manufacturers, dealers
and individuals are licensed to sell firearms in the
United States; and
(12) Federal firearm licenses are inexpensive,
relatively easy to obtain, and may only be revoked
upon criminal conviction.
(b) PURPOSE.—The purpose of this Act is to help al-
leviate the public health care cost resulting from firearm-
related injury and death by—
(1) establishing a transactional tax on the pur-
chase of the firearms and ammunition most com-
monly associated with injury and death;
(2) raising licensing fees for dealers who sell
such firearms and ammunition; and
(3) using funds generated from the trans-
actional tax and licensing fees to help offset the
health care cost resulting from firearm injury and
death.
SEC. 3. INCREASE IN TAX ON HANDGUNS AND ASSAULT
WEAPONS.
(a) INCREASE IN MANUFACTURER’S TAX.—Section
4181 of the Internal Revenue Code of 1986 (relating to
imposition of tax on firearms) is amended to read as fol-
lows:
‘‘SEC. 4181. IMPOSITION OF TAX.
‘‘(a) IMPOSITION OF TAX.—There is hereby imposed
upon the sale by the manufacturer, producer, or importer
of any of the following articles a tax equivalent to the spec-
ified percent of the price for which so sold:
‘‘(1) ARTICLES
TAXABLE
AT
PERCENT.—
With respect to the following articles, the specified
percent is 25 percent:
‘‘(A) Handguns.
‘‘(B) Assault weapons.
‘‘(C) Large capacity magazines.
‘‘(D) Shells and cartridges used in hand-
guns and assault weapons.
‘‘(2) ARTICLES
TAXABLE
AT
PERCENT.—
With respect to the following articles the specified
percent is 11 percent:
‘‘(A) Firearms (other than handguns, as-
sault weapons, and pistols or revolvers).
‘‘(B) Shells and cartridges not taxable at
25 percent.
‘‘(3) ARTICLES
TAXABLE
AT
PERCENT.—
With respect to pistols and revolvers not taxable at
25 percent under paragraph (1), the specified per-
cent is 10 percent.
‘‘(b) DEFINITIONS.—For purposes of subsection
(a)—
‘‘(1) HANDGUN.—The term ‘handgun’ means a
firearm which, at the time of manufacture, had a
barrel of less than 12 inches in length.
‘‘(2) ASSAULT
WEAPON.—The term ‘assault
weapon’ means—
‘‘(A) a firearm—
‘‘(i) which—
‘‘(I) has a barrel of between 12
and 18 inches in length, and
‘‘(II) is capable of receiving am-
munition directly from a large capac-
ity ammunition magazine, or
‘‘(ii) which is a semiautomatic firearm
which is—
‘‘(I) not recognized generally as
particularly suitable for, or readily
adaptable to, sporting purposes, or
‘‘(II) concealable by a person, or
‘‘(B) a firearm which is substantially func-
tionally equivalent to a firearm described in
subparagraph (A).
‘‘(3) LARGE
CAPACITY
AMMUNITION
MAGA-
ZINE.—The term ‘large capacity ammunition maga-
zine’ means a detachable magazine, belt, drum, feed
strip, or similar device which has, or which may be
readily restored (or converted) to a device which has,
a capacity of 15 or more rounds of ammunition.’’
(b) RETAIL TAX ON SUBSEQUENT TRANSACTIONS
INVOLVING ASSAULT WEAPONS AND HANDGUNS.—
(1) IN GENERAL.—Chapter 31 of the Internal
Revenue Code of 1986 (relating to retail excise
taxes) is amended by adding at the end the following
new subchapter:
‘‘Subchapter D—Handguns and Assault
Weapons
‘‘Sec. 4056. Handguns and assault weapons.
‘‘SEC. 4056. HANDGUNS AND ASSAULT WEAPONS.
‘‘(a) IMPOSITION OF TAX.—There is hereby imposed
on any sale, transfer, or other disposition by any person
of a handgun, assault weapon, large capacity magazine,
or shell or cartridge used in handguns and assault weap-
ons a tax equal to 25 percent of the price for which sold,
transferred, or disposed of.
‘‘(b) EXCEPTIONS.—
‘‘(1) COORDINATION
WITH
MANUFACTURER’S
TAX.—If tax has been paid under section 4181 with
respect to any article, no tax shall be imposed under
subsection (a) on such article until a sale, transfer,
or disposition occurring after the first retail sale of
the article.
‘‘(2) DEFENSE DEPARTMENT.—No tax shall be
imposed by subsection (a) on any sale described in
section 4182(b).
‘‘(c) DEFINITIONS.—For purposes of this section, the
terms ‘handgun’, ‘assault weapon’, and ‘large capacity
magazine’ have the meanings given such terms by section
4181(b).’’
(2) CONFORMING AMENDMENT.—The table of
subchapters for chapter 31 of such Code is amended
by adding at the end the following new item:
‘‘Subchapter D. Handguns and assault weapons.’’
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to sales, transfers, and other dis-
positions after the 30th day after the date of the enact-
ment of this Act.
SEC. 4. HEALTH CARE TRUST FUND.
(a) IN GENERAL.—Subchapter A of chapter 98 of the
Internal Revenue Code of 1986 (relating to establishment
of trust funds) is amended by adding at the end the follow-
ing new section:
‘‘SEC. 9512. HEALTH CARE TRUST FUND.
‘‘(a) ESTABLISHMENT OF TRUST FUND.—There is
established in the Treasury of the United States a trust
fund to be known as the ‘Health Care Trust Fund’, con-
sisting of such amounts as may be appropriated or cred-
ited to such Trust Fund as provided in this section or
section 9602(b).
‘‘(b) TRANSFERS TO THE TRUST FUND.—There are
hereby appropriated to the Health Care Trust Fund
amounts equivalent to—
‘‘(1) the taxes received in the Treasury under
section 4056,
‘‘(2) the taxes received in the Treasury under
section 4181 which are attributable to the tax on
articles subject to the 25-percent rate, and
‘‘(3) the amounts described in the last sentence
of section 923(a) of title 18, United States Code.
‘‘(c) EXPENDITURES FROM TRUST FUND.—Funds in
the Health Care Trust Fund shall be available, as pro-
vided in appropriations Acts, only for the purpose of mak-
ing grants to assist hospitals, trauma centers, or other
health care providers that have incurred substantial un-
compensated costs in providing medical care to gunshot
victims, except that no single hospital, trauma center, or
health care provider may receive more than one-tenth of
1 percent of the funds appropriated under this section.
‘‘(d) ELIGIBILITY FOR TRUST FUND MONEYS.—A
hospital, trauma center, or other health care provider is
eligible to apply for grants from the Health Care Trust
Fund for any calendar year if the hospital, trauma center,
or health care provider—
‘‘(1) is in compliance with Federal and State
certification and licensing requirements;
‘‘(2) is a not-for-profit entity; and
‘‘(3) has incurred substantial uncompensated
costs during the previous calendar year in providing
medical care to gunshot victims.
‘‘(e) REGULATIONS FOR TRUST FUND.—The Sec-
retary shall, not later than 60 days after the date of enact-
ment of this section and in consultation with the Secretary
of Health and Human Services, issue such regulations as
are necessary to implement the provisions of this section.’’
(b) CONFORMING AMENDMENT.—The table of sec-
tions for subchapter A of chapter 98 of such Code is
amended by adding at the end the following new item:
‘‘Sec. 9512. Health Care Trust Fund.’’
SEC. 5. LICENSE APPLICATION FEES FOR DEALERS IN
FIREARMS.
(a) IN GENERAL.—Section 923(a) of title 18, United
States Code, is amended—
(1) in paragraph (3)(B), by striking ‘‘$200’’
and all that follows through ‘‘$90 for 3 years’’ and
inserting ‘‘$2,500 per year’’; and
(2) by adding at the end the following:
‘‘There are hereby appropriated to the Health Care Trust
Fund established under section 9512 of the Internal Reve-
nue Code of 1986 (26 U.S.C. 9512) one-half of the reve-
nue from the fees collected under paragraph (3)(B).’’
(b) EFFECTIVE DATE.—The amendments made by
this section shall apply to license applications filed after
the 30th day after the date of the enactment of this Act.
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