I
103D CONGRESS
2D SESSION
H. R. 4698
To terminate price support and marketing quotas for tobacco, disallow the
income tax deduction for certain advertising expenses for tobacco prod-
ucts, and to establish a trust fund to support anti-drugs and anti-
tobacco use activities.
IN THE HOUSE OF REPRESENTATIVES
JUNE 30, 1994
Ms. ENGLISH of Arizona introduced the following bill; which was referred
jointly to the Committees on Agriculture, Ways and Means, Energy and
Commerce, and Education and Labor
A BILL
To terminate price support and marketing quotas for to-
bacco, disallow the income tax deduction for certain ad-
vertising expenses for tobacco products, and to establish
a trust fund to support anti-drugs and anti-tobacco use
activities.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. TERMINATION OF TOBACCO PRICE SUPPORT
AND MARKETING QUOTAS.
(a) TERMINATION OF TOBACCO PRICE SUPPORT.—
The Agricultural Act of 1949 (7 U.S.C. 1421 et seq.) is
amended—
(1) in section 101 (7 U.S.C. 1441)—
(A) in subsection (a), by striking ‘‘tobacco
(except as otherwise provided herein), corn,’’
and inserting ‘‘corn’’;
(B) by striking subsection (c); and
(C) in subsection (d)(3), by striking ‘‘, ex-
cept tobacco,’’;
(2) by striking section 106 (7 U.S.C. 1445);
(3) by striking section 106A (7 U.S.C. 1445–
1);
(4) by striking section 106B (7 U.S.C. 1445–
2); and
(5) in section 408 (7 U.S.C. 1428)—
(A) in subsection (c), by striking ‘‘to-
bacco,’’; and
(B) in subsection (d), by adding before the
period at the end the following: ‘‘or tobacco’’.
(b) 
TERMINATION
OF
TOBACCO
MARKETING
QUOTAS.—Part I (sections 311 through 320B) of subtitle
B of title III of the Agricultural Adjustment Act of 1938
(7 U.S.C. 1311–1316) is repealed.
(c) CONFORMING AMENDMENTS.—(1) Section 3 of
Public Law 98–59 (7 U.S.C. 625) is repealed.
(2) The Agricultural Adjustment Act of 1938 is fur-
ther amended—
(A) in section 301(b) (7 U.S.C. 1301(b))—
(i) by striking paragraphs (3)(C), (10)(B),
(14)(B), (14)(C), (14)(D), (15), (16)(B), and
(17);
(ii) in paragraph (6)(A), by striking ‘‘to-
bacco,’’
(iii) in the undesignated subparagraphs in
paragraph (7), by striking
‘‘Tobacco (flue-cured), July 1–June 30;
‘‘Tobacco (other than flue-cured), October
1–September 30;’’
(iv) in paragraph (11)(B), by striking ‘‘and
tobacco’’; and
(v) in paragraph (12), by striking ‘‘to-
bacco,’’;
(B) in section 303 (7 U.S.C. 1303), by striking
‘‘rice, or tobacco’’ and inserting ‘‘or rice’’; and
(C) in section 372(b) (7 U.S.C. 1372(b)), by
striking ‘‘Except as provided in section 320B, the
amount’’ in the third sentence and inserting ‘‘The
amount’’.
(3) Section 703 of Public Law 89–321 (7 U.S.C.
1316; 79 Stat. 1210) is amended by striking the second
sentence.
(4) The Act of July 12, 1952 (7 U.S.C. 1315; Chap-
ter 709; 66 Stat. 597), is repealed.
(d) EFFECTIVE DATE AND APPLICATION OF AMEND-
MENTS.—The amendments made by this section shall take
effect on January 1, 1995. Beginning on that date, the
Secretary of Agriculture shall terminate all loan agree-
ments entered into with tobacco producer associations
under section 106A of the Agricultural Adjustment Act
of 1938 and provide for the disposal of all funds in the
No Net Cost Tobacco Fund of those associations and the
No Net Cost Tobacco Account of the Commodity Credit
Corporation.
(e) CONTINUED LIABILITY
OF PRODUCERS.—An
amendment made by this section shall not affect the liabil-
ity of any person under any provision of law as in effect
before the effective date of this section.
SEC. 2. DISALLOWANCE OF DEDUCTION FOR CERTAIN AD-
VERTISING EXPENSES FOR TOBACCO PROD-
UCTS.
(a) DEDUCTION DISALLOWED.—Part IX of sub-
chapter B of chapter 1 of the Internal Revenue Code of
1986 (relating to items not deductible) is amended by add-
ing at the end the following new section:
‘‘SEC. 280I. DISALLOWANCE OF DEDUCTION FOR CERTAIN
ADVERTISING 
EXPENSES 
FOR 
TOBACCO
PRODUCTS.
‘‘(a) IN GENERAL.—No deduction otherwise allow-
able under this chapter shall be allowed for any amount
paid or incurred as a consumer sales promotion for any
tobacco product.
‘‘(b) CONSUMER SALES PROMOTION.—For purposes
of this section, the term ‘consumer sales promotion’ means
any of the following:
‘‘(1) All radio and television commercials, news-
paper and magazine advertisements, billboards, post-
ers, signs, decals, matchbook advertising, advertising
in movie theaters, and point-of-purchase display ma-
terial (except price information) used for—
‘‘(A) promoting the sale of tobacco and to-
bacco products, or
‘‘(B) informing or influencing the general
public (or any segment thereof) with respect to
tobacco and tobacco products.
‘‘(2) Any of the following incurred or provided
primarily for purposes described in paragraph (1):
‘‘(A) Travel expenses (including meals and
lodging).
‘‘(B) Any amount attributable to goods or
services of a type generally considered to con-
stitute entertainment, amusement, or recreation
or to the use of a facility in connection with the
providing of such goods or services.
‘‘(C) Gifts.
‘‘(D) Other promotion expenses.
‘‘(3) Advertising promotion allowances.
‘‘(4) Premiums and samples.
‘‘(5) Sponsorships of athletic, artistic, or other
events under the registered brand name of a tobacco
product unless the brand name is the name of a cor-
poration in existence on July 1, 1994.
‘‘(6) Marketing of nontobacco products or serv-
ices bearing the registered brand name or logo of a
tobacco product unless the brand name is the name
of a corporation in existence on July 1, 1994.
‘‘(7) Displaying the registered brand name or
logo of a tobacco product on cars, boats, animals, or
other sporting equipment or on nontobacco products
or services which are sold unless the brand name is
the name of a corporation in existence on July 1,
1994.
‘‘(8) Payment to have a registered brand name
of a tobacco product appear in a movie or play un-
less the brand name is the name of a corporation in
existence on July 1, 1994.
‘‘(c) TOBACCO PRODUCT.—For purposes of this sec-
tion, the term ‘tobacco product’ means cigarettes, cigars,
smokeless tobacco, pipe tobacco, or any similar tobacco
product. For purposes of the preceding sentence, the
terms ‘cigarette’, ‘cigar’, and ‘smokeless tobacco’ have the
respective meanings given to such terms by section 5702.’’
(b) CONFORMING AMENDMENT.—The table of sec-
tions for such part IX is amended by adding at the end
thereof the following new item:
‘‘Sec. 280I. Disallowance of deduction for certain advertising ex-
penses for tobacco products.’’
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to amounts paid or incurred after
the date of the enactment of this Act.
SEC. 3. ESTABLISHMENT OF ANTI-TOBACCO USE TRUST
FUND.
(a) IN GENERAL.—Subchapter A of chapter 98 of the
Internal Revenue Code of 1986 (relating to trust fund
code) is amended by adding at the end the following new
section:
‘‘SEC. 9512. ANTI-TOBACCO USE TRUST FUND.
‘‘(a) CREATION OF TRUST FUND.—There is estab-
lished in the Treasury of the United States a trust fund
to be known as the ‘Anti-Tobacco Use Trust Fund’, con-
sisting of such amounts as may be appropriated or cred-
SEC. 4. ESTABLISHMENT OF ANTI-TOBACCO ADVERTISING
CAMPAIGN.
Title XVII of the Public Health Service Act (42
U.S.C. 300u et seq.) is amended by adding at the end
the following section:
‘‘ANTI-TOBACCO USE ADVERTISING CAMPAIGN
‘‘SEC. 1709. With amounts available under section
9512(d) of the Internal Revenue Code of 1986 (relating
to the Anti-Tobacco Use Trust Fund), the Secretary shall
carry out a program of advertising to educate the public
on the risks to health that result from the use of tobacco
products.’’.
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