Q: 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.

This Act may be cited as the ''Zero Gravity, Zero Tax Act of
2003''.

SEC. 2. EXCLUSION OF SPACE-RELATED INCOME FROM GROSS INCOME.

(a) In General.--Part III of subchapter B of chapter 1 of the
Internal Revenue Code of 1986 (relating to items specifically excluded
from gross income) is amended by redesignating section 140 as section
140A and inserting after section 139 the following new section:

''SEC. 140. SPACE-RELATED INCOME.

''(a) General Rule.--Gross income shall not include space-related
income.
''(b) Space-Related Income.--
''(1) In general.--For purposes of this section, the term
'space-related income' means--
''(A) income derived from the sale by the taxpayer
to an unrelated person of--
''(i) any product or article which is
produced by the taxpayer in outer space, and
''(ii) any service provided by the taxpayer
in or from outer space,
''(B) income of an individual attributable to
services performed in or from outer space by such
individual in a trade or business, and
''(C) any amount not described in subparagraph (A)
or (B) which is interest, rent, royalty, or similar
amount received with respect to production or service
described in subparagraph (A) or (B).
''(2) Exception for telecommunications services, etc.--
Paragraph (1)(A)(ii) shall not apply to--
''(A) any telecommunications service provided from
earth orbit,
''(B) any service provided by a weather or other
earth observation satellite, and
''(C) any other service provided on or before the
date of the enactment of this section of transporting
property to or from outer space.
''(3) Exception for wages.--Paragraph (1) shall not apply
to wages (as defined in section 3401) received by any employee
of an employer.
''(4) Proportional allocation between space-based and
earth-based activities.--In the case of any product or article
which is produced partly in space, space-related income shall
be an amount which bears the same ratio to the amount of gross
income attributable to the sale of such product or article as
the expenses attributable to producing such product or article
in space bears to the total expenses incurred in producing such
product or article.
''(5) Produced.--For purposes of this section, the term
'produced' includes created, fabricated, developed, grown,
manufactured, extracted, processed, cured, and aged.
''(c) Exclusion From Tariffs, Etc.--Any product--
''(1) which is manufactured in outer space, and
''(2) which was--
''(A) launched from, and returned to Earth, within
the United States, or
''(B) Manufactured at a facility in outer space
which is owned by 1 or more United States persons,
shall be exempt from all Federal excises, imposts, and
duties and any other Federal tariffs.
''(d) Phaseout of Benefits.--In the case of a taxable year
beginning after December 31, 2012, the amount excluded under subsection
(a) shall be reduced (but not below zero) by x/10th's of the amount
excludable without regard to this subsection, where 'x' is the number
of years such taxable year is after the last taxable year beginning
before January 1, 2013. A similar rule shall apply to the benefits
under subsection (c).''.
(b) Clerical Amendment.--The table of sections for part III of
subchapter B of chapter 1 of such Code is amended by striking the last
item and inserting the following new items:

''Sec. 140. Space-related income.
''Sec. 140A. Cross references to other
Acts.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2003.

SEC. 3. CREDIT FOR PURCHASE OF QUALIFIED SPACE COMPANY STOCK.

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

''SEC. 45G. SPACE COMPANY INVESTMENT CREDIT.

''(a) General Rule.--For purposes of section 38, the space company
investment credit determined under this section for any taxable year is
the amount paid in the taxable year for the purchase of qualified stock
in a qualified space company.
''(b) Qualified Space Company.--For purposes of this section--
''(1) In general.--The term 'qualified space company' means
a domestic C corporation if for the 3-taxable-year period
ending with the taxable year immediately preceding the taxable
year in which qualified stock is purchased--
''(A) the average annual gross receipts of such
entity does not exceed $100,000,000, and
''(B) more than 70 percent of such gross receipts
are derived from space-based business.
''(2) Space-based business.--The term 'space-based
business' means a business whose gross receipts are
substantially space-related income, as defined in section
140(b).
''(3) Aggregation rules.--Rules similar to the rules of
section 1202(d)(3) shall apply.
''(c) Qualified Stock.--For purposes of this section--
''(1) In general.--Except as otherwise provided in this
section, the term 'qualified stock' means any stock in a
domestic C corporation if--
''(A) as of the date of issuance of such stock,
such corporation is a qualified space company, and
''(B) except as provided in subsections (f) and
(h), such stock is acquired by the taxpayer at its
original issue (directly or through an underwriter)--
''(i) in exchange for money or other
property (not including stock), or
''(ii) as compensation for services
provided to such corporation (other than
services performed as an underwriter of such
stock).
''(2) Active business requirement.--Stock in a corporation
shall not be treated as qualified stock unless, during
substantially all of the taxpayer's holding period for such
stock--
''(A) such corporation meets active business
requirements substantially similar to the requirements
of section 1202(e), determined on the basis that the
qualified trade or business is a space-based business,
and
''(B) such corporation is a C corporation.
''(3) Certain purchase by corporation of its own stock.--
Rules similar to the rules of section 1202(c)(3) shall apply.
''(e) Recapture.--If, during any taxable year ending with or within
the 10-year period beginning on the date qualified stock was purchased
by the taxpayer, the issuer of such stock ceases to a qualified space
company, the tax under this chapter for such taxable year shall be
increased by the aggregate decrease in the credits allowed under
section 38 for all prior taxable years which would have resulted solely
from reducing to zero any credit determined under subsection (a) with
respect to such stock.
''(f) Termination.--This section shall not apply to stock acquired
after December 31, 2011.''.
(b) Credit Allowed as Part of General Business Credit.--Section
38(b) of such Code (defining current year business credit) is amended
by striking ''plus'' at the end of paragraph (14), by striking the
period at the end of paragraph (15) and inserting '', plus'', and by
adding at the end the following new paragraph:
''(16) space company investment credit determined under
section 45G(a).''.
(c) Conforming Amendments.--
(1) Section 39(d) of such Code is amended by adding at the
end the following new paragraph:
''(11) No carryback of space company investment credit
before january 1, 2004.--No portion of the unused business
credit for any taxable year which is attributable to the space
company investment credit determined under section 45G may be
carried back to a taxable year beginning before January 1,
2004.''.
(2) Subsection (c) of section 196 of such Code is amended
by striking ''and'' at the end of paragraph (9), by striking
the period at the end of paragraph (10) and inserting '',
and'', and by adding at the end the following new paragraph:
''(11) the space company investment credit determined under
section 45G(a).''.
(3) The table of sections for subpart D of part IV of
subchapter A of chapter 1 of such Code is amended by adding at
the end the following new item:

''Sec. 45G. Space Company Investment
Credit.''.
(d) Effective Date.--The amendments made by this section shall
apply to costs paid or incurred in taxable years beginning after
December 31, 2003.

SEC. 4. CAPITAL GAINS EXCLUSION.

(a) In General.--(1) Part I of subchapter P of the Internal Revenue
Code of 1986 (relating to treatment of capital gains) is amended by
adding at the end the following new section:

''SEC. 1203. EXCLUSION FOR GAINS FROM SALE OR EXCHANGE OF STOCK OF
QUALIFIED SPACE CORPORATIONS.

''(a) In General.--Gross income shall not include gain on the sale
or exchange of any stock of a qualified space corporation.
''(b) Qualified Space Corporation.--For purposes of subsection (a),
the term 'qualified space corporation' means, with respect to any
taxable year, a domestic corporation which is a C corporation if--
''(1) such corporation is organized exclusively for
providing to unrelated persons--
''(A) any product or article which is produced
(within the meaning of section 140(b)(5)) by the
corporation in outer space, or
''(B) any service provided by the corporation in or
from outer space, and
''(2) At least 90 percent of the expenses of such
corporation are attributable to the active conduct of a trade
or business of providing a product, article, or service
described in paragraph (1).
Such term shall not include a corporation providing a service, product,
or article described in section 140(b)(2).''.
(2) Clerical Amendment.--The table of sections for part I of
subchapter P of such Code is amended by adding at the end the following
new item:

''Sec. 1203. Exclusion for gains from
sale or exchange of stock of
qualified space
corporations.''.
(b) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2003.
A:
Zero Gravity, Zero Tax Act of 2003 - Amends the Internal Revenue Code to exclude from gross income: (1) space-related income; and (2) gain on the sale or exchange of any stock of a qualified space corporation.Establishes a space company investment credit for the purchase of qualified stock in a qualified space company.