In this task, you are given text for US Congressional and California state bills, your task is to generate a summary for this bill.

SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.

    (a) Short Title.--This Act may be cited as the ``Long-Term 
Investment Incentive Act of 1997''.
    (b) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this Act an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Internal Revenue Code of 1986.

SEC. 2. REDUCTION OF TAX ON LONG-TERM CAPITAL GAINS ON ASSETS HELD MORE 
              THAN 2 YEARS.

    (a) In General.--Part I of subchapter P of chapter 1 (relating to 
treatment of capital gains) is amended by redesignating section 1202 as 
section 1203 and by inserting after section 1201 the following new 
section:

``SEC. 1202. CAPITAL GAINS DEDUCTION FOR ASSETS HELD BY NONCORPORATE 
              TAXPAYERS MORE THAN 2 YEARS.

    ``(a) General Rule.--If a taxpayer other than a corporation has a 
net capital gain for any taxable year, there shall be allowed as a 
deduction an amount equal to the sum of the applicable percentages of 
the classes of net capital gain described in the table under subsection 
(b).
    ``(b) Applicable Percentage.--For purposes of this subsection, the 
applicable percentage shall be the percentage determined in accordance 
with the following table:

          
                                                         The applicable
          ``In the case of:
                                                         percentage is:
                  2-year gain........................        7.145     
                  3-year gain........................        14.29     
                  4-year gain........................        21.45     
                  5-year gain........................        28.57     
                  6-year gain........................        35.71     
                  7-year gain........................        42.86     
                  8-year gain........................        50.00.    
    ``(c) Gain to Which Deduction Applies.--For purposes of this 
section--
            ``(1) 2-year gain.--The term `2-year gain' means the lesser 
        of--
                    ``(A) the net capital gain for the taxable year, or
                    ``(B) the amount of long-term capital gain which 
                would be computed for the taxable year if only gain 
                from the sale or exchange of property held by the 
                taxpayer for more than 2 years but not more than 3 
                years were taken into account.
            ``(2) 3-year gain, etc.--The terms `3-, 4-,
        5-, 6-, or 7-year gain' mean the amounts determined under 
        paragraph (1)--
                    ``(A) by reducing the amount of the net capital 
                gain under subparagraph (A) thereof by an amount equal 
                to the long-term capital gain from the sale or exchange 
                of property with a holding period less than the minimum 
                holding period for any such category, and
                    ``(B) by substituting 3, 4, 5, 6, or 7 years for 2 
                years and 4, 5, 6, 7, or 8 years for 3 years, 
                respectively, in subparagraph (B) thereof.
            ``(3) 8-year gain.--The term `8-year gain' means the lesser 
        of--
                    ``(A) the net capital gain for the taxable year, 
                reduced by in the same manner as under paragraph 
                (2)(A), or
                    ``(B) the amount of the long-term capital gain 
                which would be computed for the taxable year if only 
                gain from the sale or exchange of property held by the 
                taxpayer for more than 8 years were taken into account.
    ``(d) Estates and Trusts.--In the case of an estate or trust, the 
deduction under subsection (a) shall be computed by excluding the 
portion (if any) of the gains for the taxable year from sales or 
exchanges of capital assets which, under sections 652 and 662 (relating 
to inclusions of amounts in gross income of beneficiaries of trusts), 
is includible by the income beneficiaries as gain derived from the sale 
or exchange of capital assets.
    ``(e) Coordination With Treatment of Capital Gain Under Limitation 
on Investment Interest.--For purposes of this section, the net capital 
gain for any taxable year shall be reduced (but not below zero) by the 
amount which the taxpayer takes into account as investment income under 
section 163(d)(4)(B)(iii).
    ``(f) Treatment of Collectibles.--
            ``(1) In general.--Solely for purposes of this section, any 
        gain or loss from the sale or exchange of a collectible shall 
be treated as a short-term capital gain or loss (as the case may be), 
without regard to the period such asset was held. The preceding 
sentence shall apply only to the extent the gain or loss is taken into 
account in computing taxable income.
            ``(2) Treatment of certain sales of interest in 
        partnership, etc.--For purposes of paragraph (1), any gain from 
        the sale or exchange of an interest in a partnership, S 
        corporation, or trust which is attributable to unrealized 
        appreciation in the value of collectibles held by such entity 
        shall be treated as gain from the sale or exchange of a 
        collectible. Rules similar to the rules of section 751(f) shall 
        apply for purposes of the preceding sentence.
            ``(3) Collectible.--For purposes of this subsection, the 
        term `collectible' means any capital asset which is a 
        collectible (as defined in section 408(m) without regard to 
        paragraph (3) thereof).
    ``(g) Transitional Rule.--
            ``(1) In general.--Gain may be taken into account under 
        subsection (c) only if such gain is properly taken into account 
        on or after May 7, 1997.
            ``(2) Special rules for pass-thru entities.--
                    ``(A) In general.--In applying paragraph (1) with 
                respect to any pass-thru entity, the determination of 
                when gains and losses are properly taken into account 
                shall be made at the entity level.
                    ``(B) Pass-thru entity defined.--For purposes of 
                subparagraph (A), the term `pass-thru entity' means--
                            ``(i) a regulated investment company,
                            ``(ii) a real estate investment trust,
                            ``(iii) an S corporation,
                            ``(iv) a partnership,
                            ``(v) an estate or trust, and
                            ``(vi) a common trust fund.''
    (b) Deduction Allowable in Computing Adjusted Gross Income.--
Subsection (a) of section 62 is amended by inserting after paragraph 
(16) the following new paragraph:
            ``(17) Long-term capital gains.--The deduction allowed by 
        section 1202.''
    (c) Maximum Capital Gains Rate.--Section 1(h) is amended by adding 
at the end the following new sentence: ``For purposes of this 
subsection, taxable income shall be computed without regard to the 
deduction allowed under section 1202.''
    (d) Treatment of Certain Pass-Thru Entities.--
            (1) Capital gain dividends of regulated investment 
        companies.--
                    (A) Subparagraph (B) of section 852(b)(3) is 
                amended to read as follows:
                    ``(B) Treatment of capital gain dividends by 
                shareholders.--A capital gain dividend shall be treated 
                by the shareholders as gain from the sale or exchange 
                of a capital asset held for more than 1 year but not 
                more than 2 years; except that the portion of any such 
                dividend designated by the company as allocable 2-, 3-, 
                4-, 5-, 6-, 7-, or 8-year gain of the company shall be 
                treated as gain from the sale or exchange of a capital 
                asset held for the amount of years in such class for 
                purposes of section 1202. Rules similar to the rules of 
                subparagraph (C) shall apply to any designation under 
                the preceding sentence.''
                    (B) Clause (i) of section 852(b)(3)(D) is amended 
                by adding at the end the following new sentence: 
                ``Rules similar to the rules of subparagraph (B) shall 
                apply in determining character of the amount to be so 
                included by any such shareholder.''
            (2) Capital gain dividends of real estate investment 
        trusts.--Subparagraph (B) of section 857(b)(3) is amended to 
        read as follows:
                    ``(B) Treatment of capital gain dividends by 
                shareholders.--A capital gain dividend shall be treated 
                by the shareholders or holders of beneficial interests 
                as gain from the sale or exchange of a capital asset 
                held for more than 1 year but not more than 2 years; 
                except that the portion of any such dividend designated 
                by the company as allocable to 2-, 3-, 4-, 5-, 6-, 7-, 
                or 8-year gain of the company shall be treated as gain 
                from the sale or exchange of a capital asset held for 
                the amount of years in such class for purposes of 
                section 1202. Rules similar to the rules of 
                subparagraph (C) shall apply to any designation under 
                the preceding sentence.''
            (3) Common trust funds.--Subsection (c) of section 584 is 
        amended--
                    (A) by inserting ``and not more than 2 years'' 
                after ``1 year'' each place it appears in paragraph 
                (2),
                    (B) by striking ``and'' at the end of paragraph 
                (2), and
                    (C) by redesignating paragraph (3) as paragraph (4) 
                and inserting after paragraph (2) the following new 
                paragraph:
            ``(3) as part of its gains from sales or exchanges of 
        capital assets held for periods described in the classes of 
        gains under section 1202(c), its proportionate share of the 
        gains of the common trust fund from sales or exchanges of 
        capital assets held for such periods, and''.
    (e) Technical and Conforming Changes.--
            (1) Subparagraph (B) of section 170(e)(1) is amended by 
        inserting ``(or, in the case of a taxpayer other than a 
        corporation, the percentage of such gain equal to 100 percent 
        minus the percentage applicable to such gain under section 
        1202(a))'' after ``the amount of gain''.
            (2) Subparagraph (B) of section 172(d)(2) is amended to 
        read as follows:
                    ``(B) the deduction under section 1202 and the 
                exclusion under section 1203 shall not be allowed.''
            (3)(A) Section 221 (relating to cross reference) is amended 
        to read as follows:

``SEC. 221. CROSS REFERENCES.

    ``(1) For deduction for net capital gains in the case of a taxpayer 
other than a corporation, see section 1202.
    ``(2) For deductions in respect of a decedent, see section 691.''
            (B) The table of sections for part VII of subchapter B of 
        chapter 1 is amended by striking ``reference'' in the item 
        relating to section 221 and inserting ``references''.
            (4) The last sentence of section 453A(c)(3) is amended by 
        striking all that follows ``long-term capital gain,'' and 
        inserting ``the maximum rate on net capital gain under section 
        1(h) or 1201 or the deduction under section 1202 (whichever is 
        appropriate) shall be taken into account.''
            (5) Paragraph (4) of section 642(c) is amended to read as 
        follows:
            ``(4) Adjustments.--To the extent that the amount otherwise 
        allowable as a deduction under this subsection consists of gain 
        from the sale or exchange of capital assets held for more than 
        1 year, proper adjustment shall be made for any deduction 
        allowable to the estate or trust under section 1202 or any 
        exclusion allowable to the estate or trust under section 
        1203(a). In the case of a trust, the deduction allowed by this 
        subsection shall be subject to section 681 (relating to 
        unrelated business income).''
            (6) The last sentence of paragraph (3) of section 643(a) is 
        amended to read as follows: ``The deduction under section 1202 
        and the exclusion under section 1203 shall not be taken into 
        account.''
            (7) Subparagraph (C) of section 643(a)(6) is amended by 
        inserting ``(i)'' before ``there shall'' and by inserting 
        before the period ``, and (ii) the deduction under section 1202 
        (relating to capital gains deduction) shall not be taken into 
        account''.
            (8) Paragraph (4) of section 691(c) is amended by striking 
        ``sections 1(h), 1201, and 1211'' and inserting ``sections 
        1(h), 1201, 1202, and 1211''.
            (9) The second sentence of section 871(a)(2) is amended by 
        inserting ``or 1203'' after ``1202''.
            (10) Subsection (d) of section 1044 is amended by striking 
        ``1202'' and inserting ``1203''.
            (11) Paragraph (1) of section 1402(i) is amended by 
        inserting ``, and the deduction provided by section 1202 shall 
        not apply'' before the period at the end thereof.
    (f) Clerical Amendment.--The table of sections for part I of 
subchapter P of chapter 1 is amended by inserting after the item 
relating to section 1201 the following new item:

                              ``Sec. 1202. Capital gains deduction for 
                                        assets held by noncorporate 
                                        taxpayers more than 2 years.''
    (g) Effective Date.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall apply to 
        taxable years ending on and after May 7, 1997.
            (2) Contributions.--The amendment made by subsection (e)(1) 
        shall apply to contributions on or after May 7, 1997.
Long-Term Investment Incentive Act of 1997 - Amends the Internal Revenue Code to establish a sliding scale capital gains deduction on assets held between two years and eight years by noncorporate taxpayers.

SECTION 1. EXPENSES FOR HOUSEHOLD AND ELDER CARE SERVICES NECESSARY FOR 
              GAINFUL EMPLOYMENT.

    (a) In General.--Subpart A of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by adding at the end 
the following new section:

``SEC. 25E. EXPENSES FOR HOUSEHOLD AND ELDER CARE SERVICES NECESSARY 
              FOR GAINFUL EMPLOYMENT.

    ``(a) Allowance of Credit.--
            ``(1) In general.--In the case of an individual for which 
        there are 1 or more qualifying individuals (as defined in 
        subsection (b)(1)) with respect to such individual, there shall 
        be allowed as a credit against the tax imposed by this chapter 
        for the taxable year an amount equal to the applicable 
        percentage of the employment-related expenses (as defined in 
        subsection (b)(2)) paid by such individual during the taxable 
        year.
            ``(2) Applicable percentage defined.--For purposes of 
        paragraph (1), the term `applicable percentage' means 35 
        percent reduced (but not below 20 percent) by 1 percentage 
        point for each $2,000 (or fraction thereof) by which the 
        taxpayer's adjusted gross income for the taxable year exceeds 
        $15,000.
    ``(b) Definitions of Qualifying Individual and Employment-Related 
Expenses.--For purposes of this section--
            ``(1) Qualifying individual.--The term `qualifying 
        individual' means an individual who--
                    ``(A) has attained age 50, and
                    ``(B) is one of the following:
                            ``(i) An individual who bears a 
                        relationship to the taxpayer described in 
                        subparagraph (C) or (D) of section 152(d)(2) 
                        (relating to fathers, mothers, and ancestors).
                            ``(ii) An individual would be a dependent 
                        of the taxpayer (as defined in section 152, 
                        determined without regard to subsections (b)(1) 
                        and (b)(2)) as a qualifying relative described 
                        in section 152(d)(1) if--
                                    ``(I) in lieu of subparagraphs (B) 
                                and (C) thereof the following applied 
                                with respect to the individual:
                                            ``(aa) the taxpayer has 
                                        provided over one-half of the 
                                        individual's support for the 
                                        calendar year in which such 
                                        taxable year begins and each of 
                                        the preceding 4 taxable years, 
                                        and
                                            ``(bb) the individual's 
                                        modified adjusted gross income 
                                        for the calendar year in which 
                                        such taxable year begins is 
                                        less than the exemption amount 
                                        (as defined in section 151(d)),
                                    ``(II) the individual is physically 
                                or mentally incapable of caring for 
                                himself or herself, and
                                    ``(III) who has the same principal 
                                place of abode as the taxpayer for more 
                                than one-half of such taxable year.
                            ``(iii) The spouse of the taxpayer who is 
                        physically or mentally incapable of caring for 
                        himself or herself.
            ``(2) Modified adjusted gross income.--The term `modified 
        adjusted gross income' means adjusted gross income determined 
        without regard to section 86.
            ``(3) Employment-related expenses.--
                    ``(A) In general.--The term `employment-related 
                expenses' means amounts paid for the following 
                expenses, but only if such expenses are incurred to 
                enable the taxpayer to be gainfully employed for any 
                period for which there are 1 or more qualifying 
                individuals with respect to the taxpayer:
                            ``(i) expenses for household services, and
                            ``(ii) expenses for the care of a 
                        qualifying individual, including expenses for 
                        respite care and hospice care.
                    ``(B) Exception.--Employment-related expenses 
                described in subparagraph (A) which are incurred for 
                services outside the taxpayer's household shall be 
                taken into account only if incurred for the care of--
                            ``(i) a qualifying individual described in 
                        paragraph (1)(A), or
                            ``(ii) a qualifying individual (not 
                        described in paragraph (1)(A)) who regularly 
                        spends at least 8 hours each day in the 
                        taxpayer's household.
                    ``(C) Dependent care centers.--Employment-related 
                expenses described in subparagraph (A) which are 
                incurred for services provided outside the taxpayer's 
                household by a dependent care center (as defined in 
                subparagraph (D)) shall be taken into account only if--
                            ``(i) such center complies with all 
                        applicable laws and regulations of a State or 
                        unit of local government, and
                            ``(ii) the requirements of subparagraph (B) 
                        are met.
                    ``(D) Dependent care center defined.--For purposes 
                of this paragraph, the term `dependent care center' 
                means any facility which--
                            ``(i) provides care for more than six 
                        individuals (other than individuals who reside 
                        at the facility), and
                            ``(ii) receives a fee, payment, or grant 
                        for providing services for any of the 
                        individuals (regardless of whether such 
                        facility is operated for profit).
    ``(c) Dollar Limit on Amount Creditable.--The amount of the 
employment-related expenses incurred during any taxable year which may 
be taken into account under subsection (a) shall not exceed--
            ``(1) $3,000 if there is 1 qualifying individual with 
        respect to the taxpayer for such taxable year, or
            ``(2) $6,000 if there are 2 or more qualifying individuals 
        with respect to the taxpayer for such taxable year.
The amount determined under paragraph (1) or (2) (whichever is 
applicable) shall be reduced by the aggregate amount excludable from 
gross income under section 129 for the taxable year.
    ``(d) Earned Income Limitation.--Except as otherwise provided in 
this subsection, the amount of the employment-related expenses incurred 
during any taxable year which may be taken into account under 
subsection (a) shall not exceed--
            ``(1) in the case of an individual who is not married at 
        the close of such year, such individual's earned income for 
        such year, or
            ``(2) in the case of an individual who is married at the 
        close of such year, the lesser of such individual's earned 
        income or the earned income of his spouse for such year.
    ``(e) Special Rules.--For purposes of this section--
            ``(1) Place of abode.--An individual shall not be treated 
        as having the same principal place of abode of the taxpayer if 
        at any time during the taxable year of the taxpayer the 
        relationship between the individual and the taxpayer is in 
        violation of local law.
            ``(2) Married couples must file joint return.--If the 
        taxpayer is married at the close of the taxable year, the 
        credit shall be allowed under subsection (a) only if the 
        taxpayer and his spouse file a joint return for the taxable 
        year.
            ``(3) Marital status.--An individual legally separated from 
        his spouse under a decree of divorce or of separate maintenance 
        shall not be considered as married.
            ``(4) Certain married individuals living apart.--If--
                    ``(A) an individual who is married and who files a 
                separate return--
                            ``(i) maintains as his home a household 
                        which constitutes for more than one-half of the 
                        taxable year the principal place of abode of a 
                        qualifying individual, and
                            ``(ii) furnishes over half of the cost of 
                        maintaining such household during the taxable 
                        year, and
                    ``(B) during the last 6 months of such taxable year 
                such individual's spouse is not a member of such 
                household, such individual shall not be considered as 
                married.
            ``(5) Payments to related individuals.--No credit shall be 
        allowed under subsection (a) for any amount paid by the 
        taxpayer to an individual--
                    ``(A) with respect to whom, for the taxable year, a 
                deduction under section 151(c) (relating to deduction 
                for personal exemptions for dependents) is allowable 
                either to the taxpayer or his spouse, or
                    ``(B) who is a child of the taxpayer (within the 
                meaning of section 152(f)(1)) who has not attained the 
                age of 19 at the close of the taxable year. For 
                purposes of this paragraph, the term `taxable year' 
                means the taxable year of the taxpayer in which the 
                service is performed.
            ``(6) Identifying information required with respect to 
        service provider.--No credit shall be allowed under subsection 
        (a) for any amount paid to any person unless--
                    ``(A) the name, address, and taxpayer 
                identification number of such person are included on 
                the return claiming the credit, or
                    ``(B) if such person is an organization described 
                in section 501(c)(3) and exempt from tax under section 
                501(a), the name and address of such person are 
                included on the return claiming the credit.
        In the case of a failure to provide the information required 
        under the preceding sentence, the preceding sentence shall not 
        apply if it is shown that the taxpayer exercised due diligence 
        in attempting to provide the information so required.
            ``(7) Identifying information required with respect to 
        qualifying individuals.--No credit shall be allowed under this 
        section with respect to any qualifying individual unless the 
        TIN of such individual is included on the return claiming the 
        credit.
    ``(f) Regulations.--The Secretary shall prescribe such regulations 
as may be necessary to carry out the purposes of this section.''.
    (b) Clerical Amendment.--The table of sections for subpart A of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by adding at the end the following new item:

``Sec. 25E. Expenses for household and elder care services necessary 
                            for gainful employment.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.
Amends the Internal Revenue Code to allow a new tax credit for employment-related expenses necessary to care for a dependent of a taxpayer who has attained age 50, including expenses for household services and for the care of the dependent, including respite care and hospice care. Limits the amount of such credit to $3,000 for the care of one dependent and $6,000 for the care of two or more dependents of the taxpayer in a taxable year. 

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Digital Goods and Services Tax 
Fairness Act of 2010''.

SEC. 2. FINDINGS.

    The Congress finds the following:
            (1) Consumers, businesses, and other participants engaged 
        in electronic commerce may be subject to multiple, confusing, 
        and burdensome taxation because of inconsistent rules among 
        thousands of State and local jurisdictions and disparate 
        treatment of digital goods and digital services.
            (2) A consistent framework for taxation is needed that will 
        not impede electronic commerce and the sale of digital goods 
        and digital services, by preventing multiple taxation, and 
        providing greater certainty and simplicity.
            (3) Neutrality should guide tax policy and administration 
        in this area. Transactions involving similar types of goods and 
        services should be taxed fairly, regardless of the method and 
        means of distribution, whether through electronic transfer or 
        through other channels of commerce. New or different taxes on 
        electronic transactions should be barred.
            (4) To ensure neutrality and avoid multiple taxation, 
        certain rules should be adapted to reflect the unique nature of 
        electronic commerce and how digital goods and digital services 
        are provided.
            (5) To recognize the critical role that online health, 
        energy management, and education services will play in our 
        economy, these services should be exempt from all State and 
        local taxes.

SEC. 3. MULTIPLE AND DISCRIMINATORY TAXES PROHIBITED.

    No State or local jurisdiction shall impose multiple or 
discriminatory taxes on or with respect to the sale or use of digital 
goods or digital services.

SEC. 4. RETAIL, SOURCING, AND OTHER LIMITATIONS.

    (a) Retail Limitation.--Taxes on or with respect to the sale or use 
of digital goods or digital services may be imposed only on or with 
respect to a sale to, or use by, a customer.
    (b) Sourcing Limitation.--
            (1) In general.--Taxes on or with respect to the sale or 
        use of digital goods or digital services may be imposed only by 
        the State and local jurisdictions whose territorial limits 
        encompass the customer's tax address. This limitation shall be 
        deemed satisfied if sourcing is determined by a seller pursuant 
        to State sourcing rules adopted pursuant to the Streamlined 
        Sales and Use Tax Agreement.
            (2) Tax address.--The customer's tax address shall be--
                    (A) with respect to digital goods or digital 
                services that are sold to a customer by a provider of 
                mobile telecommunications service that is subject to 
                being sourced under section 117 of title 4 of the 
                United States Code, and furnished to the customer in 
                conjunction with such provider's mobile 
                telecommunications service, the customer's place of 
                primary use, as defined in section 124 of title 4 of 
                the United States Code;
                    (B) if subparagraph (A) does not apply, and if the 
                digital good or digital service is received by the 
                customer at a business location of the seller, such 
                business location;
                    (C) if neither subparagraph (A) nor subparagraph 
                (B) applies, and if the location where the digital good 
                or digital service is received by the customer is known 
                to the seller, such location;
                    (D) if none of subparagraphs (A) through (C) 
                applies, the customer's address that is either known to 
                the seller or, if not known, obtained by the seller 
                during the consummation of the transaction, including 
                the address of the customer's payment instrument if no 
                other address is available;
                    (E) if an address is neither known nor obtained as 
                provided in subparagraph (D), the address of the seller 
                from which the digital good or digital service was 
                sold; and
                    (F) notwithstanding subparagraphs (A) through (E), 
                for digital goods or digital services that are 
                delivered to a person other than the customer, 
                including advertising services, the delivery location 
                if known or, otherwise, the customer's address 
                determined under subparagraph (D) or (E).
    (c) Limit on Expansive Interpretation.--No tax on or with respect 
to the sale or use of tangible personal property, telecommunications 
service, Internet access service, or audio or video programming service 
may be construed by any regulation, administrative ruling, or 
otherwise, to be imposed on or with respect to the sale or use of a 
digital good or a digital service. No tax on or with respect to the 
sale or use of a digital good may be construed by any regulation, 
administrative ruling, or otherwise, to be imposed on or with respect 
to the sale or use of a digital service. The limitations provided by 
this subsection shall not apply to any construction that was approved 
by a judicial determination made on or before June 30, 2010.
    (d) Certain Taxes Prohibited.--No tax shall be imposed on or with 
respect to the sale or use of digital medical services, digital 
education services, or digital energy management services.

SEC. 5. BUNDLED GOODS AND SERVICES.

    If charges for digital goods or digital services are aggregated 
with, and not separately stated from, charges for other goods or 
services, then the charges for digital goods or digital services may be 
taxed for purposes of this Act at the same rate and on the same basis 
as charges for the other goods or services unless the seller can 
reasonably identify the charges for the digital goods or digital 
services from its books and records kept in the regular course of 
business.

SEC. 6. DEFINITIONS AND OTHER SPECIAL RULES.

    For the purposes of this Act, the following definitions and rules 
apply:
            (1) Customer.--The term ``customer'' means a person that 
        purchases a digital good or digital service, for a purpose 
        other than resale. For the purpose of determining a place of 
        primary use under section 4(b)(2)(A), ``customer'' means the 
        ``end user'', as such term is used in section 124 of title 4 of 
        the United States Code, of the purchased digital good or 
        digital service. For purposes of this definition, purchase for 
        resale includes purchase of a digital good or digital service 
        for further commercial broadcast, rebroadcast, transmission, 
        retransmission, licensing, relicensing, reproduction, copying, 
        distribution, redistribution, or exhibition of the digital good 
        or digital service, in whole or in part, to another person.
            (2) Delivered or transferred electronically.--The term 
        ``delivered or transferred electronically'' means delivered or 
        transferred to the customer by means other than tangible 
        storage media. It is not necessary that the product or service 
        be physically transferred to the customer, provided that the 
        customer may access or remotely use the product or service.
            (3) Digital good and digital service.--The term ``digital 
        good'' means any good or product that is delivered or 
        transferred electronically to the customer, including software, 
        information maintained in digital format, digital audio-visual 
        works, digital audio works, and digital books; and the term 
        ``digital service'' means any service that is delivered or 
        transferred electronically to the customer, including the 
        provision of remote access to or use of a digital good, but the 
        term ``digital service'' does not include telecommunications 
        service, Internet access service, or audio or video programming 
        service. For purposes of this section, ``audio or video 
        programming'' means programming provided by, or generally 
        considered comparable to programming provided by, a radio or 
        television broadcast station. ``Video programming'' shall not 
        include interactive on-demand services, pay-per-view services, 
        or services generally considered comparable to such services 
        regardless of the technology used to provide such services.
            (4) Digital education service.--The term ``digital 
        education service'' means a primary, secondary, undergraduate, 
        postgraduate, or professional educational service delivered or 
        transferred electronically to a practitioner or student.
            (5) Digital energy management service.--The term ``digital 
        energy management service'' means a service that utilizes 
        digital information to manage a customer's energy use, to allow 
        a customer to respond to energy market information or 
        circumstances, or to identify customer demand with particular 
        energy supply.
            (6) Digital medical service.--The term ``digital medical 
        service'' means a health care, health information, or health 
        education service that is delivered or transferred 
        electronically to a practitioner, researcher, or patient.
            (7) Digital code.--The term ``digital code'' means a code 
        that conveys to a customer only the right to obtain a digital 
        good or digital service. A digital code may be obtained by any 
        means, including by email or by tangible means regardless of 
        its designation as ``song code'', ``video code'', or ``book 
        code''. The tax treatment of the sale or use of a digital code 
        shall be the same as the tax treatment of the digital good or 
        digital service to which the digital code relates. The sale of 
        the digital code shall be considered the sale transaction for 
        purposes of this Act.
            (8) Discriminatory tax.--The term ``discriminatory tax'' 
        means any tax imposed by a State or local jurisdiction--
                    (A) on or with respect to the sale or use of any 
                digital good or digital service at a higher rate than 
                is generally imposed on or with respect to the sale or 
                use of tangible personal property or of similar 
                services that are not delivered or transferred 
                electronically;
                    (B) on or with respect to any seller of digital 
                goods or digital services at a higher rate or by 
                incorporating a broader tax base than is generally 
                imposed on or with respect to sellers in transactions 
                involving tangible personal property or involving 
                similar services that are not delivered or transferred 
                electronically. This provision applies only to the 
                extent that the higher rate or broader tax base is 
                attributable to the fact that such person sells digital 
                goods or digital services; or
                    (C) that is required to be collected with respect 
                to the sale or use of digital goods or digital services 
                by different sellers or under other terms that are 
                disadvantageous to those applied in taxing the sale or 
                use of tangible personal property or of similar 
                services that are not delivered or transferred 
                electronically.
        For purposes of this subsection, all taxes, tax rates, 
        exemptions, deductions, credits, incentives, exclusions, and 
        other similar factors shall be taken into account in 
        determining whether a tax is a discriminatory tax.
            (9) Generally imposed.--A tax shall not be considered 
        ``generally imposed'' if it is imposed only on specific 
        services, specific industries or business segments, or specific 
        types of property.
            (10) Multiple tax.--The term ``multiple tax'' means any tax 
        with respect to which no credit is given for comparable taxes 
        paid to other States or local jurisdictions on the same 
        transaction. Taxes imposed by physically overlapping State or 
        local jurisdictions shall not be considered to be multiple 
        taxes by reason of being applied within the overlapping area.
            (11) Sale and purchase.--The terms ``sale'' and 
        ``purchase'', and all variations thereof, shall include 
        ``lease'', ``rent'', and ``license'', and corresponding 
        variations thereof.
            (12) Seller.--The term ``seller'' means a person making 
        sales of tangible personal property, digital goods, digital 
        services, or other services.
            (13) State or local jurisdiction.--The term ``State or 
        local jurisdiction'' means any of the several States, the 
        District of Columbia, any territory or possession of the United 
        States, a political subdivision of any State, territory, or 
        possession, or any governmental entity or person acting on 
        behalf of such State, territory, possession, or subdivision and 
        with the authority to assess, impose, levy, or collect taxes.
            (14) Tax.--The term ``tax'' means any charge imposed by any 
        governmental entity for the purpose of generating revenues for 
        governmental purposes, including any tax, charge, or fee levied 
        by a taxing jurisdiction as a fixed charge for each customer or 
        measured by gross amounts charged to customers, regardless of 
        whether such tax, charge, or fee is imposed on the vendor or 
        customer and regardless of the terminology used to describe the 
        tax, charge, or fee. The term ``tax'' does not include a tax on 
        or measured by net income or an ad valorem tax.

SEC. 7. FEDERAL JURISDICTION.

    Notwithstanding section 1341 of title 28 of the United States Code, 
and without regard to the amount in controversy or citizenship of the 
parties, a district court of the United States has jurisdiction, 
concurrent with other jurisdiction of courts of the United States and 
the States, to prevent a violation of this Act.

SEC. 8. REGULATIONS.

    The Secretary of Commerce, in consultation with the Secretary of 
the Treasury, shall prescribe such regulations as may be necessary or 
appropriate to carry out the purposes of this Act. In promulgating any 
regulations under this Act, the Secretary shall also seek the 
consultation of the Executive Director of the Governing Board of the 
Streamlined Sales Tax Project.

SEC. 9. EFFECTIVE DATE; APPLICATION.

    (a) General Rule.--This Act shall take effect on the date of the 
enactment of this Act.
    (b) Application to Liabilities and Pending Cases.--Nothing in this 
Act affects liability for taxes accrued and enforced before the date of 
enactment of this Act, or affects ongoing litigation relating to such 
taxes, except as provided in section 4(c) of this Act.

SEC. 10. SENSE OF THE CONGRESS.

    It is the sense of the Congress that each State shall take 
reasonable steps necessary to prevent multiple taxation of digital 
goods and digital services in situations where a foreign country has 
imposed a tax on such goods or services.

Digital Goods and Services Tax Fairness Act of 2010 - Prohibits a state or local jurisdiction from imposing multiple or discriminatory taxes on or with respect to the sale or use of digital goods or services delivered or transferred electronically to a customer.

Restricts taxation of digital goods and services to the retail sale of such goods and services and by the jurisdiction encompassing a customer's tax address.

Prohibits the use of existing regulations or administrative rulings relating to the taxation of tangible personal property or other services to impose any tax on the sale or use of digital goods or services.

Prohibits taxation on or with respect to the sale or use of digital medical, education, or energy management services.

Provides that if charges for digital goods and services are not separately stated from charges for other goods or services, the charges for digital goods and services may be taxed at the same rate and on the same basis as charges for other goods and services unless the seller can reasonably identify the charges for digital goods and services from its business records.

Grants jurisdiction to federal district courts to prevent a violation of this Act.

Expresses the sense of Congress that each state shall take reasonable steps to prevent multiple taxation of digital goods and services where a foreign country has imposed a tax on such goods and services.