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a rate of tax for purposes of section 15 of the Internal
Revenue Code of 1986.
Subtitle A—American Health
Security Trust Fund
SEC. 801. AMERICAN HEALTH SECURITY TRUST FUND.
(a) IN GENERAL.—There is hereby created on the
books of the Treasury of the United States a trust fund
to be known as the American Health Security Trust Fund
(in this section referred to as the ‘‘Trust Fund’’). The
Trust Fund shall consist of such gifts and bequests as
may be made and such amounts as may be deposited in,
or appropriated to, such Trust Fund as provided in this
Act.
(b) APPROPRIATIONS INTO TRUST FUND.—
(1) TAXES.—There are hereby appropriated to
the Trust Fund for each fiscal year (beginning with
fiscal year 2000), out of any moneys in the Treasury
not otherwise appropriated, amounts equivalent to
100 percent of the aggregate increase in tax liabil-
ities under the Internal Revenue Code of 1986 which
is attributable to the application of the amendments
made by this title. The amounts appropriated by the
preceding sentence shall be transferred from time to
time (but not less frequently than monthly) from the
general fund in the Treasury to the Trust Fund,
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such amounts to be determined on the basis of esti-
mates by the Secretary of the Treasury of the taxes
paid to or deposited into the Treasury; and proper
adjustments shall be made in amounts subsequently
transferred to the extent prior estimates were in ex-
cess of or were less than the amounts that should
have been so transferred.
(2) CURRENT
PROGRAM
RECEIPTS.—Notwith-
standing any other provision of law, there are hereby
appropriated to the Trust Fund for each fiscal year
(beginning with fiscal year 2000) the amounts that
would otherwise have been appropriated to carry out
the following programs:
(A) The medicare program, under parts A
and B of title XVIII of the Social Security Act
(other than amounts attributable to any pre-
miums under such parts).
(B) The medicaid program, under State
plans approved under title XIX of such Act.
(C) The Federal employees health benefit
program, under chapter 89 of title 5, United
States Code.
(D) The CHAMPUS program, under chap-
ter 55 of title 10, United States Code.
161
(E) The maternal and child health pro-
gram (under title V of the Social Security Act),
vocational rehabilitation programs, programs
for drug abuse and mental health services
under the Public Health Service Act, programs
providing general hospital or medical assistance,
and any other Federal program identified by
the Board, in consultation with the Secretary of
the Treasury, to the extent the programs pro-
vide for payment for health services the pay-
ment of which may be made under this Act.
(c) INCORPORATION OF PROVISIONS.—The provisions
of subsections (b) through (i) of section 1817 of the Social
Security Act shall apply to the Trust Fund under this Act
in the same manner as they applied to the Federal Hos-
pital Insurance Trust Fund under part A of title XVIII
of such Act, except that the American Health Security
Standards Board shall constitute the Board of Trustees
of the Trust Fund.
(d) TRANSFER OF FUNDS.—Any amounts remaining
in the Federal Hospital Insurance Trust Fund or the Fed-
eral Supplementary Medical Insurance Trust Fund after
the settlement of claims for payments under title XVIII
have been completed, shall be transferred into the Amer-
ican Health Security Trust Fund.
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Subtitle B—Taxes Based on Income
and Wages
SEC. 811. PAYROLL TAX ON EMPLOYERS.
(a) IN GENERAL.—Section 3111 (relating to tax on
employers) is amended by redesignating subsection (c) as
subsection (d) and by inserting after subsection (b) the
following new subsection:
‘‘(c) HEALTH CARE.—In addition to other taxes,
there is hereby imposed on every employer an excise tax,
with respect to having individuals in his employ, equal to
8.7 percent of the wages (as defined in section 3121(a))
paid by him with respect to employment (as defined in
section 3121(b)).’’
(b) SELF-EMPLOYMENT INCOME.—Section 1401 (re-
lating to rate of tax on self-employment income) is amend-
ed by redesignating subsection (c) as subsection (d) and
by inserting after subsection (b) the following new sub-
section:
‘‘(c) HEALTH CARE.—In addition to other taxes,
there shall be imposed for each taxable year, on the self-
employment income of every individual, a tax equal to 8.7
percent of the amount of the self-employment income for
such taxable year.’’
(c) COMPARABLE
TAXES
FOR
RAILROAD
SERV-
ICES.—
163
(1) TAX
ON
EMPLOYERS.—Section 3221 is
amended by redesignating subsections (c), (d), and
(e) as subsections (d), (e), and (f), respectively, and
by inserting after subsection (b) the following new
subsection:
‘‘(c) HEALTH CARE.—In addition to other taxes,
there is hereby imposed on every employer an excise tax,
with respect to having individuals in his employ, equal to
8.7 percent of the compensation paid by such employer
for services rendered to such employer.’’
(2) TAX ON EMPLOYEE REPRESENTATIVES.—
Subsection (a) of section 3211 (relating to tax on
employee representatives) is amended by redesig-
nating paragraph (3) as paragraph (4) and by in-
serting after paragraph (2) the following new para-
graph:
‘‘(3) HEALTH
CARE.—In addition to other
taxes, there is hereby imposed on the income of each
employee representative a tax equal to 8.7 percent of
the compensation received during the calendar year
by such employee representative for services ren-
dered by such employee representative.
(3) NO APPLICABLE BASE.—Subparagraph (A)
of section 3231(e)(2) is amended by adding at the
end thereof the following new clause:
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‘‘(iv) HEALTH CARE TAXES.—Clause
(i) shall not apply to the taxes imposed by
sections 3221(c) and 3211(a)(3).’’
(4) TECHNICAL AMENDMENTS.—
(A) Paragraph (4) of section 3211(a), as
redesignated by paragraph (2), is amended by
striking ‘‘and (2)’’ and inserting ‘‘, (2), and
(3)’’.
(B) Subsection (f) 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, 2000.
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
166
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
December 31, 2000.
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) by striking ‘‘$1.828 cents per thousand
($1.594 cents per thousand on cigars removed dur-
ing 2000 or 2001)’’ in paragraph (1) and inserting
‘‘$2.11 per thousand’’, and
(2) by striking ‘‘equal to’’ and all that follows
in paragraph (2) and inserting ‘‘equal to 23.91 per-
167
cent 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
168
section 5702(k) of the Internal Revenue Code of 1986)
after December 31, 2000.
(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, 2001, 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, 2001, 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.
169
(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, 2001, 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, 2001.
(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, 2001, shall be subject to the tax im-
posed by paragraph (1) if—