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(D) providing (directly or through referral)
counseling and consultation services to consum-
ers to assist them in choosing long-term care
insurance coverage appropriate to their cir-
cumstances.
(b) REPORT
TO CONGRESS.—The Secretary shall
submit to Congress a specific legislative proposal to pro-
vide for the authorization of appropriations of Federal
funds to support the program design completed under sub-
section (a).
TITLE IV—FINANCING
SEC. 401. PHASE IN OF 24-CENT/PACK INCREASE IN EXCISE
TAXES ON CIGARETTES.
(a) CIGARETTES.—Subsection (b) of section 5701 of
the Internal Revenue Code of 1986 is amended—
(1) by striking ‘‘$12 per thousand ($10 per
thousand on cigarettes removed during 1991 or
1992)’’ in paragraph (1) and inserting ‘‘$24 per
thousand ($20 per thousand on cigarettes removed
during 1999, $16 per thousand on cigarettes re-
moved during 1998)’’, and
(2) by striking ‘‘$25.20 per thousand ($21 per
thousand on cigarettes removed during 1991 or
1992)’’ in paragraph (2) and inserting ‘‘$50.40 per
thousand ($42 per thousand on cigarettes removed
124
during 1999, $33.60 per thousand on cigarettes re-
moved during 1998)’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to cigarettes removed after De-
cember 31, 1997.
(c) FLOOR STOCKS TAXES.—
(1) IMPOSITION OF TAX.—On cigarettes manu-
factured in or imported into the United States which
are removed before any tax-increase date and held
on such date for sale by any person, there shall be
imposed the following taxes:
(A) SMALL
CIGARETTES.—On cigarettes,
weighing not more than 3 pounds per thousand,
$4 per thousand.
(B) LARGE
CIGARETTES.—On cigarettes
weighing more than 3 pounds per thousand,
$8.40 per thousand; except that, if more than
61⁄2 inches in length, they shall be taxable at
the rate prescribed for cigarettes weighing not
more than 3 pounds per thousand, counting
each 23⁄4 inches, or fraction thereof, of the
length of each as one cigarette.
(2) EXCEPTION
FOR
CERTAIN
AMOUNTS
OF
CIGARETTES.—
125
(A) IN
GENERAL.—No tax shall be im-
posed by paragraph (1) on cigarettes held on
any tax-increase date by any person if—
(i) the aggregate number of cigarettes
held by such person on such date does not
exceed 30,000, and
(ii) such person submits to the Sec-
retary (at the time and in the manner re-
quired by the Secretary) such information
as the Secretary shall require for purposes
of this subparagraph.
For purposes of this subparagraph, in the case
of cigarettes measuring more than 61⁄2 inches
in length, each 23⁄4 inches (or fraction thereof)
of the length of each shall be counted as one
cigarette.
(B) AUTHORITY TO EXEMPT CIGARETTES
HELD IN VENDING MACHINES.—To the extent
provided in regulations prescribed by the Sec-
retary, no tax shall be imposed by paragraph
(1) on cigarettes held for retail sale on any tax-
increase date by any person in any vending ma-
chine. If the Secretary provides such a benefit
with respect to any person, the Secretary may
reduce the 30,000 amount in subparagraph (A)
126
and the $60 amount in paragraph (3) with re-
spect to such person.
(3) CREDIT AGAINST TAX.—Each person shall
be allowed as a credit against the taxes imposed by
paragraph (1) an amount equal to $60. 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 cigarettes on any tax-increase date 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 the 1st June 30 following the tax-increase
date.
(5) DEFINITIONS.—For purposes of this sub-
section—
127
(A) TAX-INCREASE DATE.—The term ‘‘tax-
increase date’’ means January 1, 1998, Janu-
ary 1, 1999, and January 1, 2000.
(B) OTHER DEFINITIONS.—Terms used in
this subsection which are also used in section
5702 of the Internal Revenue Code of 1986
shall have the respective meanings such terms
have in such section.
(C) SECRETARY.—The term ‘‘Secretary’’
means the Secretary of the Treasury or his del-
egate.
(6) CONTROLLED
GROUPS.—Rules similar to
the rules of section 5061(e)(3) of such Code shall
apply for purposes of this subsection.
(7) 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 a tax-increase date shall be subject to the tax im-
posed by paragraph (1) if—
(A) internal revenue taxes have been deter-
mined, or customs duties liquidated, with re-
spect to such article before such date pursuant
to a request made under the 1st proviso of sec-
tion 3(a) of such Act, or
128
(B) such article is held on such date under
the supervision of a customs officer pursuant to
the 2d proviso of such section 3(a).
(8) OTHER LAWS APPLICABLE.—All provisions
of law, including penalties, applicable with respect to
the taxes imposed by section 5701 of such Code
shall, insofar as applicable and not inconsistent with
the provisions of this subsection, apply to the floor
stocks taxes imposed by paragraph (1), to the same
extent as if such taxes were imposed by such section
5701.
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