[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2803 Introduced in House (IH)]







105th CONGRESS
  1st Session
                                H. R. 2803

 To amend the Internal Revenue Code of 1986 to reduce the noncorporate 
                        capital gains tax rate.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            November 4, 1997

  Mr. Graham introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to reduce the noncorporate 
                        capital gains tax rate.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. REDUCTION IN NONCORPORATE CAPITAL GAINS TAX RATE.

    (a) In General.--Subsection (h) of section 1 of the Internal 
Revenue Code of 1986 (relating to maximum capital gains rate) is 
amended to read as follows:
    ``(h) Maximum Capital Gains Rate.--
            ``(1) In general.--If a taxpayer has a net capital gain for 
        any taxable year, the tax imposed by this section for such 
        taxable year shall not exceed the sum of--
                    ``(A) a tax computed at the rates and in the same 
                manner as if this subsection had not been enacted on 
                taxable income reduced by the net capital gain,
                    ``(B) 8 percent of so much of the net capital gain 
                (or, if less, taxable income) as does not exceed the 
                excess (if any) of--
                            ``(i) the amount of taxable income which 
                        would (without regard to this paragraph) be 
                        taxed at a rate below 28 percent, over
                            ``(ii) the taxable income reduced by the 
                        net capital gain, and
                    ``(C) 18 percent of the net capital gain (or, if 
                less, taxable income) in excess of the amount on which 
                a tax is determined under subparagraph (B).
            ``(2) Net capital gain taken into account as investment 
        income.--For purposes of paragraph (1), the net capital gain 
        for any taxable year shall be reduced (but not below zero) by 
        the amount which the taxpayer elects to take into account as 
        investment income for the taxable year under section 
        163(d)(4)(B)(iii).''
    (b) Alternative Minimum Tax.--Paragraph (3) of section 55(b) of 
such Code (relating to tentative minimum tax) is amended to read as 
follows:
            ``(3) Maximum rate of tax on net capital gain of 
        noncorporate taxpayers.--The amount determined under the first 
        sentence of paragraph (1)(A)(i) shall not exceed the sum of--
                    ``(A) the amount determined under such first 
                sentence computed at the rates and in the same manner 
                as if this paragraph had not been enacted on the 
                taxable excess reduced by the net capital gain, plus
                    ``(B) 8 percent of so much of the net capital gain 
                (or, if less, taxable excess) as does not exceed the 
                amount on which a tax is determined under section 
                1(h)(1)(B), plus
                    ``(C) 18 percent of the net capital gain (or, if 
                less, taxable excess) in excess of the amount on which 
                tax is determined under subparagraph (B).''
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1997.
                                 <all>