I 
116TH CONGRESS 
1ST SESSION H. R. 1516 
To amend the Internal Revenue Code of 1986 to impose a tax on certain 
trading transactions. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 5, 2019 
Mr. DEFAZIO (for himself, Mr. CICILLINE, Ms. DELAURO, Mr. GRIJALVA, Ms. 
JAYAPAL, Mr. KHANNA, Mr. LOWENTHAL, Mr. MCGOVERN, Mrs. 
NAPOLITANO, Ms. NORTON, Ms. OCASIO-CORTEZ, Ms. PINGREE, Mr. 
POCAN, Mr. SARBANES, Ms. SCHAKOWSKY, Mr. WELCH, and Mr. 
COHEN) introduced the following bill; which was referred to the Com-
mittee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to impose 
a tax on certain trading transactions. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Wall Street Tax Act 
of 2019’’. 
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SEC. 2. TRANSACTION TAX. 
(a) IN GENERAL.—Chapter 36 of the Internal Rev-
enue Code of 1986 is amended by inserting after sub-
chapter B the following new subchapter: 
‘‘Subchapter C—Tax on Trading Transactions 
‘‘Sec. 4475. Tax on trading transactions. 
‘‘Sec. 4476. Derivative defined. 
‘‘SEC. 4475. TAX ON TRADING TRANSACTIONS. 
‘‘(a) IMPOSITION OF TAX.—There is hereby imposed 
a tax on each covered transaction with respect to any secu-
rity. 
‘‘(b) RATE OF TAX.—The tax imposed under sub-
section (a) with respect to any covered transaction shall 
be 0.1 percent of the specified base amount with respect 
to such covered transaction. 
‘‘(c) SPECIFIED BASE AMOUNT.—For purposes of 
this section, the term ‘specified base amount’ means— 
‘‘(1) except as provided in paragraph (2), the 
fair market value of a security (determined as of the 
time of the covered transaction), and 
‘‘(2) in the case of any payment with respect to 
a derivative, the amount of such payment. 
‘‘(d) COVERED TRANSACTION.—For purposes of this 
section— 
‘‘(1) IN GENERAL.—The term ‘covered trans-
action’ means— 
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‘‘(B) any partnership or beneficial owner-
ship interest in a partnership or trust, 
‘‘(C) except as provided in paragraph (2), 
any note, bond, debenture, or other evidence of 
indebtedness, and 
‘‘(D) any derivative (as defined in section 
4476). 
‘‘(2) EXCEPTION FOR CERTAIN TRADED SHORT- 
TERM INDEBTEDNESS.—A note, bond, debenture, or 
other evidence of indebtedness which— 
‘‘(A) is traded on, or is subject to the rules 
of, a qualified board or exchange located in the 
United States, and 
‘‘(B) has a fixed maturity of not more 
than 100 days, 
shall not be treated as described in paragraph 
(1)(C). 
‘‘(3) QUALIFIED BOARD OR EXCHANGE.—The 
term ‘qualified board or exchange’ has the meaning 
given such term by section 1256(g)(7). 
‘‘(f) BY WHOM PAID.— 
‘‘(1) IN GENERAL.—The tax imposed by this 
section shall be paid by— 
‘‘(A) in the case of a transaction which oc-
curs on, or is subject to the rules of, a qualified 
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board or exchange located in the United States, 
such qualified board or exchange, and 
‘‘(B) in the case of a purchase not de-
scribed in subparagraph (A) which is executed 
by a broker (as defined in section 6045(c)(1)) 
which is a United States person, such broker. 
‘‘(2) SPECIAL
RULES
FOR
DIRECT, 
ETC., 
TRANSACTIONS.—In the case of any transaction to 
which paragraph (1) does not apply, the tax imposed 
by this section shall be paid by— 
‘‘(A) in the case of a transaction described 
in subsection (d)(1)(A)— 
‘‘(i) the purchaser if the purchaser is 
a United States person, and 
‘‘(ii) the seller if the purchaser is not 
a United States person, and 
‘‘(B) in the case of a transaction described 
in subsection (d)(1)(B)— 
‘‘(i) the payor if the payor is a United 
States person, and 
‘‘(ii) the payee if the payor is not a 
United States person. 
‘‘(g) TREATMENT OF EXCHANGES AND PAYMENTS 
WITH RESPECT TO DERIVATIVES.—For purposes of this 
section— 
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‘‘(1) TREATMENT OF EXCHANGES.— 
‘‘(A) IN GENERAL.—An exchange shall be 
treated as the sale of the property transferred 
and a purchase of the property received by each 
party to the exchange. 
‘‘(B) CERTAIN DEEMED EXCHANGES.—In 
the case of a distribution treated as an ex-
change for stock under section 302 or 331, the 
corporation making such distribution shall be 
treated as having purchased such stock for pur-
poses of this section. 
‘‘(2) PAYMENTS
WITH
RESPECT
TO
DERIVA-
TIVES TREATED AS SEPARATE TRANSACTIONS.—Ex-
cept as otherwise provided by the Secretary, any 
payment with respect to any derivative shall be 
treated as a separate transaction for purposes of 
this section. 
‘‘(h) APPLICATION
TO
TRANSACTIONS
BY
CON-
TROLLED FOREIGN CORPORATIONS.— 
‘‘(1) IN GENERAL.—For purposes of this sec-
tion, a controlled foreign corporation shall be treated 
as a United States person. 
‘‘(2) SPECIAL RULES FOR PAYMENT OF TAX ON 
DIRECT, ETC., TRANSACTIONS.—In the case of any 
transaction which is a covered transaction solely by 
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reason of paragraph (1) and which is not described 
in subsection (f)(1)— 
‘‘(A) PAYMENT BY UNITED STATES SHARE-
HOLDERS.—Any tax which would (but for this 
paragraph) be payable under subsection (f)(2) 
by the controlled foreign corporation shall, in 
lieu thereof, be paid by the United States 
shareholders of such controlled foreign corpora-
tion as provided in subparagraph (B). 
‘‘(B) PRO
RATA
SHARES.—Each such 
United States shareholder shall pay the same 
proportion of such tax as— 
‘‘(i) the stock which such United 
States shareholder owns (within the mean-
ing of section 958(a)) in such controlled 
foreign corporation, bears to 
‘‘(ii) the stock so owned by all United 
States shareholders in such controlled for-
eign corporation. 
‘‘(C) DEFINITIONS.—For purposes of this 
subsection, the terms ‘United States share-
holder’ and ‘controlled foreign corporation’ have 
the meanings given such terms in sections 
951(b) and 957(a), respectively. 
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‘‘(i) ADMINISTRATION.—The Secretary shall carry 
out this section in consultation with the Securities and Ex-
change Commission and the Commodity Futures Trading 
Commission. 
‘‘(j) GUIDANCE; REGULATIONS.—The Secretary 
shall— 
‘‘(1) provide guidance regarding such informa-
tion reporting concerning covered transactions as the 
Secretary deems appropriate, and 
‘‘(2) prescribe such regulations as are necessary 
or appropriate to prevent avoidance of the purposes 
of this section, including the use of non-United 
States persons in such transactions. 
‘‘SEC. 4476. DERIVATIVE DEFINED. 
‘‘(a) IN GENERAL.—For purposes of this subchapter, 
except as otherwise provided in this section, the term ‘de-
rivative’ means any contract (including any option, for-
ward contract, futures contract, short position, swap, or 
similar contract) the value of which, or any payment or 
other transfer with respect to which, is (directly or indi-
rectly) determined by reference to one or more of the fol-
lowing: 
‘‘(1) Any share of stock in a corporation. 
‘‘(2) Any partnership or beneficial ownership 
interest in a partnership or trust. 
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‘‘(3) Any evidence of indebtedness. 
‘‘(4) Except as provided in subsection (b)(1), 
any real property. 
‘‘(5) Any commodity which is actively traded 
(within the meaning of section 1092(d)(1)). 
‘‘(6) Any currency. 
‘‘(7) Any rate, price, amount, index, formula, or 
algorithm. 
‘‘(8) Any other item as the Secretary may pre-
scribe. 
Except as provided in regulations prescribed by the Sec-
retary to prevent the avoidance of the purposes of this 
subchapter, such term shall not include any item described 
in paragraphs (1) through (8). 
‘‘(b) EXCEPTIONS.— 
‘‘(1) CERTAIN REAL PROPERTY.— 
‘‘(A) IN GENERAL.—For purposes of this 
subchapter, the term ‘derivative’ shall not in-
clude any contract with respect to interests in 
real 
property 
(as 
defined 
in 
section 
856(c)(5)(C)) if such contract requires physical 
delivery of such real property. 
‘‘(B) OPTIONS TO SETTLE IN CASH.— 
‘‘(i) IN
GENERAL.—For purposes of 
subparagraph (A), a contract which pro-
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