[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 38 Introduced in Senate (IS)]







106th CONGRESS
  1st Session
                                 S. 38

To amend the Internal Revenue Code of 1986 to phase out the estate and 
                   gift taxes over a 10-year period.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            January 19, 1999

Mr. Campbell (for himself, Mr. Mack, and Mrs. Hutchison) introduced the 
 following bill; which was read twice and referred to the Committee on 
                                Finance

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to phase out the estate and 
                   gift taxes over a 10-year period.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Estate and Gift Tax Rate Reduction 
Act of 1999''.

SEC. 2. FINDINGS.

    The Congress finds and declares that--
            (1) estate and gift tax rates, which reach as high as 55 
        percent of a decedent's taxable estate, are in most cases 
        substantially in excess of the tax rates imposed on the same 
        amount of regular income and capital gains income; and
            (2) a reduction in estate and gift tax rates to a level 
        more comparable with the rates of tax imposed on regular income 
        and capital gains income will make the estate and gift tax less 
        confiscatory and mitigate its negative impacts on American 
        families and businesses.

SEC. 3. PHASEOUT OF ESTATE AND GIFT TAXES.

    (a) Repeal of Estate and Gift Taxes.--Subtitle B of the Internal 
Revenue Code of 1986 (relating to estate and gift taxes) is repealed 
effective with respect to estates of decedents dying, and gifts made, 
after December 31, 2009.
    (b) Phaseout of Tax.--Subsection (c) of section 2001 of such Code 
(relating to imposition and rate of tax) is amended by adding at the 
end the following new paragraph:
            ``(3) Phaseout of tax.--In the case of estates of decedents 
        dying, and gifts made, during any calendar year after 1999 and 
        before 2010--
                    ``(A) In general.--The tentative tax under this 
                subsection shall be determined by using a table 
                prescribed by the Secretary (in lieu of using the table 
                contained in paragraph (1)) which is the same as such 
                table; except that--
                            ``(i) each of the rates of tax shall be 
                        reduced (but not below zero) by the number of 
                        percentage points determined under subparagraph 
                        (B), and
                            ``(ii) the amounts setting forth the tax 
                        shall be adjusted to the extent necessary to 
                        reflect the adjustments under clause (i).
                    ``(B) Percentage points of reduction.--

                                                          The number of
``For calendar year:                              percentage points is:
    2000..........................................                   5 
    2001..........................................                  10 
    2002..........................................                  15 
    2003..........................................                  20 
    2004..........................................                  25 
    2005..........................................                  30 
    2006..........................................                  35 
    2007..........................................                  40 
    2008..........................................                  45 
    2009..........................................                  50.
                    ``(C) Coordination with paragraph (2).--Paragraph 
                (2) shall be applied by reducing the 55 percent 
                percentage contained therein by the number of 
                percentage points determined for such calendar year 
                under subparagraph (B).
                    ``(D) Coordination with credit for state death 
                taxes.--Rules similar to the rules of subparagraph (A) 
                shall apply to the table contained in section 2011(b) 
                except that the number of percentage points referred to 
                in subparagraph (A)(i) shall be determined under the 
                following table:

                                                          The number of
``For calendar year:                              percentage points is:
    2000..........................................              1\1/2\ 
    2001..........................................                   3 
    2002..........................................              4\1/2\ 
    2003..........................................                   6 
    2004..........................................              7\1/2\ 
    2005..........................................                   9 
    2006..........................................             10\1/2\ 
    2007..........................................                  12 
    2008..........................................             13\1/2\ 
    2009..........................................                15.''
    (c) Effective Date.--The amendments made by this section shall 
apply to estates of decedents dying, and gifts made, after December 31, 
1999.
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