I
103D CONGRESS
1ST SESSION
H. R. 718
To amend the Internal Revenue Code of 1986 to allow a refundable credit
for the purchase of domestically manufactured automobiles.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 2, 1993
Mr. GILMAN 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 allow a
refundable credit for the purchase of domestically manu-
factured automobiles.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. CREDIT FOR PURCHASE OF DOMESTICALLY
MANUFACTURED AUTOMOBILES.
(a) GENERAL RULE.—Subpart C of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of
1986 (relating to refundable credits) is amended by redes-
ignating section 35 as section 36 and by inserting after
section 34 the following new section:
‘‘SEC. 35. PURCHASE OF DOMESTICALLY MANUFACTURED
AUTOMOBILES.
‘‘(a) ALLOWANCE OF CREDIT.—There shall be al-
lowed as a credit against the tax imposed by this subtitle
for the taxable year an amount for each qualified auto-
mobile acquired by the taxpayer during the taxable year
equal to the lesser of—
‘‘(1) 10 percent of the cost of such automobile
to the taxpayer, or
‘‘(2) $2,500 ($1,000 in the case of a qualified
automobile described in subsection (b)(1)(B)).
‘‘(b) QUALIFIED AUTOMOBILE.—For purposes of this
section—
‘‘(1) IN GENERAL.—The term ‘qualified auto-
mobile’ means any automobile if such automobile is
manufactured in the United States and if—
‘‘(A) such automobile is purchased by the
taxpayer in the 1st retail sale of such auto-
mobile (within the meaning of section 4011), or
‘‘(B) such automobile is acquired by the
taxpayer in a qualified resale and such resale
occurs within the 2-year period beginning on
the date of the 1st retail sale of such auto-
mobile.
‘‘(2) AUTOMOBILE.—The term ‘automobile’
means any 4-wheeled vehicle which is propelled by
fuel (as defined in section 4064(b)(7)) and which is
manufactured primarily for use on public streets,
roads, and highways.
‘‘(3) QUALIFIED RESALE.—The term ‘qualified
resale’ means any sale of an automobile if—
‘‘(A) such sale is after the 1st retail sale
of such automobile,
‘‘(B) such sale is for a purpose other than
resale, and
‘‘(C) no credit was allowed under this sec-
tion for any prior acquisition of such auto-
mobile other than at its 1st retail sale.
‘‘(c) SPECIAL RULES.—For purposes of this sec-
tion—
‘‘(1) 
MANUFACTURED
IN
THE
UNITED
STATES.—An automobile shall be treated as manu-
factured in the United States if at least 75 percent
of the cost to the manufacturer of such vehicle is at-
tributable to value added in the United States or
Canada.
‘‘(2) JOINT
ACQUISITIONS.—If any qualified
automobile is jointly acquired by two or more per-
sons—
‘‘(A) the aggregate amount allowable as
credit under subsection (a) to such persons with
respect to such automobile shall be determined
by treating all of such persons as one taxpayer
whose taxable year is the calendar year in
which such acquisition occurs, and
‘‘(B) there shall be allowed to each of such
persons a credit under subsection (a) for such
person’s taxable year in which such calendar
year ends in an amount which bears the same
ratio to the credit determined under subpara-
graph (A) as the portion of the cost of such
automobile borne by such person bears to the
aggregate cost of such automobile.
‘‘(d) BASIS REDUCTION.—The basis of any qualified
automobile shall be reduced by the amount of the credit
allowable under this section to the taxpayer for the pur-
chase of such automobile.’’
(b) CLERICAL AMENDMENT.—The table of sections
for subpart C of part IV of subchapter A of chapter 1
of such Code is amended by striking the item relating to
section 35 and inserting the following:
‘‘Sec. 35. Credit for purchase of domestically manufactured auto-
mobiles.
‘‘Sec. 36. Overpayments of tax.’’
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to automobiles acquired after De-
cember 31, 1993.
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