165 
‘‘(iv) HEALTH CARE TAXES.—Clause 
(i) shall not apply to the taxes imposed by 
sections 3221(c) and 3211(c).’’. 
(4) TECHNICAL AMENDMENT.— 
(A) Subsection (d) of section 3211, as re-
designated by paragraph (2), is amended by 
striking ‘‘and (b)’’ and inserting ‘‘, (b), and 
(c)’’. 
(B) Subsection (d) of section 3221, as re-
designated by paragraph (1), is amended by 
striking ‘‘and (b)’’ and inserting ‘‘, (b), and 
(c)’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to remuneration paid after Decem-
ber 31, 2008. 
SEC. 812. HEALTH CARE INCOME TAX. 
(a) GENERAL RULE.—Subchapter A of chapter 1 (re-
lating to determination of tax liability) is amended by add-
ing at the end thereof the following new part: 
‘‘PART VIII—HEALTH CARE INCOME TAX ON 
INDIVIDUALS 
‘‘Sec. 59B. Health care income tax. 
‘‘SEC. 59B. HEALTH CARE INCOME TAX. 
‘‘(a) IMPOSITION OF TAX.—In the case of an indi-
vidual, there is hereby imposed a tax (in addition to any 
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other tax imposed by this subtitle) equal to 2.2 percent 
of the taxable income of the taxpayer for the taxable year. 
‘‘(b) NO CREDITS AGAINST TAX; NO EFFECT ON 
MINIMUM TAX.—The tax imposed by this section shall not 
be treated as a tax imposed by this chapter for purposes 
of determining— 
‘‘(1) the amount of any credit allowable under 
this chapter, or 
‘‘(2) the amount of the minimum tax imposed 
by section 55. 
‘‘(c) SPECIAL RULES.— 
‘‘(1) TAX TO BE WITHHELD, ETC.—For pur-
poses of this title, the tax imposed by this section 
shall be treated as imposed by section 1. 
‘‘(2) REIMBURSEMENT OF TAX BY EMPLOYER 
NOT INCLUDIBLE IN GROSS INCOME.—The gross in-
come of an employee shall not include any payment 
by his employer to reimburse the employee for the 
tax paid by the employee under this section. 
‘‘(3) OTHER
RULES.—The rules of section 
59A(d) shall apply to the tax imposed by this sec-
tion.’’. 
(b) CLERICAL AMENDMENT.—The table of parts for 
subchapter A of chapter 1 is amended by adding at the 
end the following new item: 
‘‘PART VIII. HEALTH CARE INCOME TAX ON INDIVIDUALS.’’. 
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(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2008. 
Subtitle C—Increase in Excise 
Taxes on Tobacco Products 
SEC. 821. INCREASE IN EXCISE TAXES ON TOBACCO PROD-
UCTS. 
(a) CIGARETTES.—Subsection (b) of section 5701 is 
amended— 
(1) by striking ‘‘$19.50 per thousand ($17 per 
thousand on cigarettes removed during 2000 or 
2001)’’ in paragraph (1) and inserting ‘‘$22.50 per 
thousand’’, and 
(2) by striking ‘‘$40.95 per thousand ($35.70 
per thousand on cigarettes removed during 2000 or 
2001)’’ in paragraph (2) and inserting ‘‘$47.25 per 
thousand’’. 
(b) CIGARS.—Subsection (a) of section 5701 is 
amended— 
(1) in paragraph (1), by striking ‘‘$1.828 cents 
per thousand ($1.594 per thousand on cigars re-
moved during 2000 or 2001)’’ in paragraph (1) and 
inserting ‘‘$2.11 per thousand’’, and 
(2) in paragraph (2) by striking ‘‘equal to’’ and 
all that follows in such paragraph and inserting 
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‘‘equal to 23.91 percent of the price for which sold 
but not more than $56.25 per thousand.’’ 
(c) CIGARETTE PAPERS.—Subsection (c) of section 
5701 is amended by striking ‘‘1.22 cents (1.06 cents on 
cigarette papers removed during 2000 or 2001)’’ and in-
serting ‘‘1.41 cents’’. 
(d) CIGARETTE TUBES.—Subsection (d) of section 
5701 is amended by striking ‘‘2.44 cents (2.13 cents on 
cigarette tubes removed during 2000 or 2001)’’ and in-
serting ‘‘2.81 cents’’. 
(e) SMOKELESS TOBACCO.—Subsection (e) of section 
5701 is amended— 
(1) by striking ‘‘58.5 cents (51 cents on snuff 
removed during 2000 or 2001)’’ in paragraph (1) 
and inserting ‘‘67.5 cents’’, and 
(2) by striking ‘‘19.5 cents (17 cents on chew-
ing tobacco removed during 2000 or 2001)’’ in para-
graph (2) and inserting ‘‘22.5 cents’’. 
(f) PIPE TOBACCO.—Subsection (f) of section 5701 
is amended by striking ‘‘$1.0969 cents (95.67 cents on 
pipe tobacco removed during 2000 or 2001)’’ and insert-
ing ‘‘$1.27’’. 
(g) EFFECTIVE DATE.—The amendments made by 
this section shall apply to articles removed (as defined in 
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section 5702(k) of the Internal Revenue Code of 1986) 
after December 31, 2008. 
(h) FLOOR STOCKS TAXES.— 
(1) IMPOSITION OF TAX.—On tobacco products 
and cigarette papers and tubes manufactured in or 
imported into the United States which are removed 
before January 1, 2009, and held on such date for 
sale by any person, there is hereby imposed a tax in 
an amount equal to the excess of— 
(A) the tax which would be imposed under 
section 5701 of the Internal Revenue Code of 
1986 on the article if the article had been re-
moved on such date, over 
(B) the prior tax (if any) imposed under 
section 5701 or 7652 of such Code on such ar-
ticle. 
(2) AUTHORITY TO EXEMPT CIGARETTES HELD 
IN VENDING MACHINES.—To the extent provided in 
regulations prescribed by the Secretary, no tax shall 
be imposed by paragraph (1) on cigarettes held for 
retail sale on January 1, 2009, by any person in any 
vending machine. If the Secretary provides such a 
benefit with respect to any person, the Secretary 
may reduce the $500 amount in paragraph (3) with 
respect to such person. 
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(3) CREDIT AGAINST TAX.—Each person shall 
be allowed as a credit against the taxes imposed by 
paragraph (1) an amount equal to $500. Such credit 
shall not exceed the amount of taxes imposed by 
paragraph (1) for which such person is liable. 
(4) LIABILITY FOR TAX AND METHOD OF PAY-
MENT.— 
(A) LIABILITY FOR TAX.—A person hold-
ing any article on January 1, 2009, to which 
any tax imposed by paragraph (1) applies shall 
be liable for such tax. 
(B) METHOD OF PAYMENT.—The tax im-
posed by paragraph (1) shall be paid in such 
manner as the Secretary shall prescribe by reg-
ulations. 
(C) TIME
FOR
PAYMENT.—The tax im-
posed by paragraph (1) shall be paid on or be-
fore July 31, 2009. 
(5) ARTICLES
IN
FOREIGN
TRADE
ZONES.— 
Notwithstanding the Act of June 18, 1934 (48 Stat. 
998, 19 U.S.C. 81a) and any other provision of law, 
any article which is located in a foreign trade zone 
on January 1, 2009, shall be subject to the tax im-
posed by paragraph (1) if— 
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