[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 41 Introduced in House (IH)]






109th CONGRESS
  1st Session
                                 H. R. 41

                To establish a commission on tax reform.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 4, 2005

 Mr. Barrett of South Carolina (for himself, Mr. Cox, Mr. Simpson, Mr. 
  Garrett of New Jersey, Mr. Green of Wisconsin, Mr. Wilson of South 
Carolina, Mr. Calvert, Mr. Burton of Indiana, Mr. Bonilla, Mr. Gary G. 
    Miller of California, Mr. Bartlett of Maryland, Mr. Pitts, Mr. 
 Doolittle, Mr. Ryun of Kansas, Mr. Chocola, Mr. Flake, and Mr. Goode) 
 introduced the following bill; which was referred to the Committee on 
Ways and Means, and in addition to the Committee on Rules, for a period 
    to be subsequently determined by the Speaker, in each case for 
consideration of such provisions as fall within the jurisdiction of the 
                          committee concerned

_______________________________________________________________________

                                 A BILL


 
                To establish a commission on tax reform.

    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 ``Tax Reform Action Commission Act of 
2005''.

SEC. 2. FINDINGS.

    The Congress finds the following:
            (1) The current Federal tax system is fundamentally 
        defective, economically counter-productive, and its complexity 
        leads to staggering costs for taxpayers.
            (2) Complexity and frequent change of the Internal Revenue 
        Code of 1986 cause taxpayer and administrative confusion and 
        uncertainty. The significant difficulty in understanding tax 
        rules and regulations due to their lack of clarity and 
        readability annually forces United States taxpayers to expend 
        enormous sums of time and money on compliance and 
        administration activities which represent a pure loss to the 
        economy every year.
            (3) A major source of complexity is the use of the Federal 
        tax system to advance social and economic policies. Targeted 
        benefits in the form of preferential rates, exclusions, 
        exemptions, deductions, credits, deferrals and adjustments are 
        examples of factors that complicate the Internal Revenue Code 
        of 1986.
            (4) Among the reasons that the Internal Revenue Code of 
        1986 is considered unfair is its dissimilar treatment of 
        similarly situated taxpayers and because those who have the 
        means to afford professional advice are more likely to receive 
        optimal treatment and maximum benefits.
            (5) The tax laws of the United States are among the most 
        burdensome and uncompetitive in the world and those laws make 
        it difficult for domestically-owned United States companies to 
        compete abroad and in the United States. A domestically-owned 
        corporation is disadvantaged compared to a United States 
        subsidiary of a foreign-owned corporation and international 
        competitiveness is forcing many United States corporations to 
        make a choice they do not want to make: go out of business, 
        sell the business to a foreign competitor, or become a 
        subsidiary of a foreign corporation.
            (6) The current tax system discourages saving and depresses 
        the level of United States capital accumulation available for 
        financing investment, which is critical to the growth potential 
        of the economy, real income, and living standards.
            (7) Past efforts at partial reform of the Internal Revenue 
        Code of 1986 have not succeeded in reducing its complexity, 
        removing its distortions of economic incentives, or making it 
        fairer. Those destructive problems and others stemming from the 
        Internal Revenue Code of 1986 can and should be addressed 
        through responsible fundamental tax reform. Despite the fact 
        that a number of viable tax reform proposals have been offered, 
        a lack of consensus has blocked progress toward the 
        consideration and enactment of an existing or new plan.
            (8) Therefore, in order to proceed with responsible and 
        needed tax reform, it is necessary to establish a Tax Reform 
        Action Commission charged with developing a proposal to achieve 
        tax reform that will benefit all Americans.

SEC. 3. OBJECTIVES OF REFORM.

    The Congress finds that it must act to reform the Internal Revenue 
Code of 1986 so that the United States has a tax system that is--
            (1) simple, transparent, and efficient;
            (2) fair and equitable to all Americans; and
            (3) neutral between different activities and between 
        current consumption and future consumption.

SEC. 4. ESTABLISHMENT OF COMMISSION.

    There is established in the legislative branch a Tax Reform Action 
Commission (in this Act referred to as the ``Commission'').

SEC. 5. DUTIES OF THE COMMISSION.

    (a) Recommendations for Reform.--Not later than 2 years after the 
date on which the Commission is established, the Commission shall make 
specific recommendations to Congress for reform of the internal revenue 
laws in a manner that incorporates the objectives of reform set forth 
in section 3. The recommendations of the Commission shall be based on 
its compilation and reconciliation of the recommendations of the task 
forces convened by the Commission pursuant to section 9 and shall 
provide for such appropriate interagency support and cooperation as may 
be necessary to attain such objectives.
    (b) Legislative Language.--The recommendations required under 
subsection (a) shall include legislative language necessary for 
carrying out such recommendations. The Commission shall develop such 
legislative language after conducting such public hearings and 
consulting with such public or private entities as the Commission 
considers necessary and appropriate to make the recommendations 
required under subsection (a).

SEC. 6. COMPOSITION OF THE COMMISSION.

    (a) Number and Appointment.--The Commission shall be composed of 15 
members, as follows:
            (1) Three members appointed by the President, two from the 
        executive branch of the Government and one from private life.
            (2) Four members appointed by the majority leader of the 
        Senate, one from Members of the Senate and three from private 
        life.
            (3) Two members appointed by the minority leader of the 
        Senate, one from Members of the Senate and one from private 
        life.
            (4) Four members appointed by the Speaker of the House of 
        Representatives, one from Members of the House and three from 
        private life.
            (5) Two members appointed by the minority leader of the 
        House of Representatives, one from Members of the House and one 
        from private life.
    (b) Qualifications.--The members of the Commission shall consist of 
individuals who are of recognized standing and distinction and who 
possess a demonstrated capacity to discharge the duties imposed on the 
Commission.
    (c) Chair.--The President shall designate a member of the 
Commission to serve as Chair of the Commission who shall chair the 
Commission, determine its duties, and supervise its staff.
    (d) Terms of Appointment.--The members of the Commission shall be 
appointed not more than 30 days after the date of the enactment of this 
Act. The members of the Commission shall serve for the life of the 
Commission.
    (e) Vacancies.--A vacancy in the Commission shall not affect the 
power of the remaining members to execute the duties of the Commission 
but any such vacancy shall be filled in the same manner in which the 
original appointment was made.

SEC. 7. PROCEDURES.

    (a) Meetings.--The Commission shall meet at the call of its Chair 
or a quorum of its members.
    (b) Quorum.--A quorum shall consist of nine members of the 
Commission, except that a lesser number may conduct a hearing under 
subsection (c).
    (c) Hearings and Other Activities.--For the purpose of carrying out 
its duties, the Commission may hold such hearings and undertake such 
other activities as the Commission determines necessary to carry out 
its duties.
    (d) Obtaining Information.--Upon request of the Commission, the 
Secretary of the Treasury and the head of any other department, agency, 
or instrumentality of the Federal Government shall furnish information 
deemed necessary by the Commission to enable it to carry out its 
duties.

SEC. 8. ADMINISTRATION.

    (a) Compensation.--Except as provided in subsection (b), members of 
the Commission shall receive no additional pay, allowances, or benefits 
by reason of their service on the Commission.
    (b) Travel Expenses and Per Diem.--Each member of the Commission 
who is not a present Member of the Congress and who is not otherwise an 
officer or employee of the Federal Government shall receive travel 
expenses and per diem in lieu of subsistence in accordance with 
sections 5702 and 5703 of title 5, United States Code.
    (c) Staff and Support Services.--
            (1) Staff director.--
                    (A) Appointment.--The Chair in accordance with the 
                rules agreed upon by the Commission shall appoint a 
                staff director for the Commission.
                    (B) Compensation.--The staff director shall be paid 
                at a rate not to exceed the rate established for level 
                V of the Executive Schedule under section 5315 of title 
                5, United States Code.
            (2) Staff.--The Chair in accordance with the rules agreed 
        upon by the Commission shall appoint such additional personnel 
        as the Commission determines to be necessary.
            (3) Applicability of civil service laws.--The staff 
        director and other members of the staff of the Commission shall 
        be appointed without regard to the provisions of title 5, 
        United States Code, governing appointments in the competitive 
        service, and shall be paid without regard to the provisions of 
        chapter 51 and subchapter III of chapter 53 of such title 
        relating to classification and General Schedule pay rates.
            (4) Experts and consultants.--With the approval of the 
        Commission, the staff director may procure temporary and 
        intermittent services under section 3109(b) of title 5, United 
        States Code.
    (d) Physical Facilities.--The Architect of the Capitol, in 
consultation with the appropriate entities in the legislative branch, 
shall locate and provide suitable office space for the operation of the 
Commission on a nonreimbursable basis. The facilities shall serve as 
the headquarters of the Commission and shall include all necessary 
equipment and incidentals required for the proper functioning of the 
Commission.
    (e) Administrative Support Services and Other Assistance.--
            (1) Upon the request of the Commission, the Architect of 
        the Capitol, the Commissioner of Social Security, and the 
        Administrator of General Services shall provide to the 
        Commission on a nonreimbursable basis such administrative 
        support services as the Commission may request.
            (2) In addition to the assistance set forth in paragraphs 
        (1) and (2), departments and agencies of the United States may 
        provide the Commission such services, funds, facilities, staff, 
        and other support services as the Commission may deem advisable 
        and as may be authorized by law.
    (f) Use of Mails.--The Commission may use the United States mails 
in the same manner and under the same conditions as Federal agencies 
and shall, for purposes of the frank, be considered a commission of 
Congress as described in section 3215 of title 39, United States Code.
    (g) Printing.--For purposes of costs relating to printing and 
binding, including the cost of personnel detailed from the Government 
Printing Office, the Commission shall be deemed to be a committee of 
the Congress.

SEC. 9. TASK FORCES.

    (a) In General.--For purposes of making and compiling 
recommendations of the Commission for submission to the Congress 
pursuant to section 5, the Commission shall establish such task forces 
and designate such departments, agencies, and instrumentalities of the 
Federal Government as it determines necessary or appropriate to 
effectively obtain the expeditious attainment of the objectives 
specified in section 3.
    (b) Agency Cooperation.--Each department, agency, and 
instrumentality designated by the Commission pursuant to subsection (a) 
in connection with one or more task forces specified in subsection (a) 
shall assign to the Commission representatives of such department, 
agency, or instrumentality for service on such task forces. The 
Commission, and each department, agency, and instrumentality designated 
for service on a task force under this section, shall provide such 
staff and administrative support services to the task force as may be 
necessary and appropriate, in accordance with procedures which shall be 
prescribed by the Commission.
    (c) Duties of Task Forces.--The Commission shall assign each task 
force a deadline for submitting its recommendations to the Commission 
and shall inform each House of the Congress of the convening of each 
task force and the deadline assigned to it. Each task force convened 
pursuant to subsection (a) shall, by such date as shall be specified by 
the Commission, provide the Commission with its recommendations for 
attaining the goals addressed by the task force, together with 
appropriate timetables for achieving such goals.
    (d) Separate Reports and Termination.--Upon submission by each task 
force of its recommendations to the Commission, the task force shall 
submit to each House of the Congress a copy of its recommendations to 
the Commission, and shall thereupon terminate.

SEC. 10. CONGRESSIONAL CONSIDERATION OF RECOMMENDATIONS.

    (a) Introduction of Recommendations and Committee Consideration.--
            (1) Introduction.--The legislative language transmitted 
        pursuant to section 5(b) with the recommendations for reform of 
        the Commission shall be in the form of a bill (in this title 
        referred to as the ``reform bill''). Such reform bill shall be 
        introduced in the House of Representatives by the Speaker, and 
        in the Senate, by the Majority Leader, on the first day of 
        session ending after receipt of the language and such reform 
        bill shall be referred to the appropriate committee of Congress 
        under paragraph (2). If the reform bill is not introduced in 
        accordance with the preceding sentence, the reform bill may be 
        introduced in either House of Congress by any member thereof.
            (2) Committee consideration.--
                    (A) Referral.--A reform bill introduced in the 
                House of Representatives shall be referred to the 
                Committee on Ways and Means of the House of 
                Representatives. A reform bill introduced in the Senate 
                shall be referred to the Committee on Finance of the 
                Senate.
                    (B) Reporting.--Not later than 30 days after the 
                introduction of the reform bill, the committee of 
                Congress to which the reform bill was referred shall 
                report the bill or a committee amendment thereto.
                    (C) Discharge of committee.--If the committee to 
                which is referred a reform bill has not reported such 
                reform bill (or an identical reform bill) at the end of 
                30 calendar days after its introduction or at the end 
                of the first day after there has been reported to the 
                House involved a reform bill, whichever is earlier, 
                such committee shall be deemed to be discharged from 
                further consideration of such reform bill and such 
                reform bill shall be placed on the appropriate calendar 
                of the House involved.
    (b) Expedited Procedure.--
            (1) Consideration.--
                    (A) In general.--Not later than 2 days after the 
                date on which a committee has been discharged from 
                consideration of a reform bill, the Speaker of the 
                House of Representatives, or the Speaker's designee, or 
                the Majority Leader of the Senate, or the Leader's 
                designee, shall move to proceed to the consideration of 
                the committee amendment to the reform bill, and if 
                there is no such amendment, to the reform bill. It 
                shall also be in order for any member of the House of 
                Representatives or the Senate, respectively, to move to 
                proceed to the consideration of the reform bill at any 
                time after the conclusion of such 2-day period.
                    (B) Points of order waived.--All points of order 
                against the reform bill (and against consideration of 
                the reform bill) are waived.
                    (C) Motion to proceed.--A motion to proceed to the 
                consideration of the reform bill is highly privileged 
                in the House of Representatives and is privileged in 
                the Senate and is not debatable. The motion is not 
                subject to amendment, to a motion to postpone 
                consideration of the reform bill, or to a motion to 
                proceed to the consideration of other business. A 
                motion to reconsider the vote by which the motion to 
                proceed is agreed to or not agreed to shall not be in 
                order. If the motion to proceed is agreed to, the House 
                of Representatives or the Senate, as the case may be, 
                shall immediately proceed to consideration of the 
                reform bill without intervening motion, order, or other 
                business, and the reform bill shall remain the 
                unfinished business of the House of Representatives or 
                the Senate, as the case may be, until disposed of.
                    (D) Limited debate.--Debate on the reform bill and 
                on all debatable motions and appeals in connection 
                therewith shall be limited to not more than the lesser 
                of 100 hours or 14 days, which shall be divided equally 
                between those favoring and those opposing the reform 
                bill. A motion further to limit debate on the reform 
                bill is in order and not debatable.
                    (E) Amendments.--
                            (i) Consideration in the house of 
                        representatives.--Subject to clause (iii), 
                        amendments to the reform bill during 
                        consideration in the House of Representatives 
                        shall be limited in accordance with a rule 
                        adopted by the Committee on Rules of the House 
                        of Representatives.
                            (ii) Consideration in the senate.--Subject 
                        to clause (iii), amendments to the reform bill 
                        during consideration in the Senate shall be 
                        limited to--
                                    (I) one first degree amendment per 
                                member or that member's designee with 1 
                                hour of debate equally divided; and
                                    (II) germane second degree 
                                amendments (without limit) with 30 
                                minutes of debate equally divided.
                            (iii) Leadership amendments.--The Speaker 
                        of the House of Representatives and the 
                        Minority Leader of the House of Representatives 
                        and the Majority Leader of the Senate and the 
                        Minority Leader of the Senate may each offer 1 
                        first degree amendment (in addition to the 
                        amendments afforded such members under clause 
                        (i) or (ii)), with 4 hours of debate equally 
                        divided on each such amendment offered. No 
                        second degree amendments may be offered by the 
                        Speaker of the House of Representatives, the 
                        Minority Leader of the House of 
                        Representatives, the Majority Leader of the 
                        Senate, or the Minority Leader of the Senate in 
                        their leadership capacities.
                    (F) Vote on final passage.--Immediately following 
                the conclusion of the debate on the reform bill, and on 
                all amendments offered to the reform bill, and all 
                votes required on amendments offered to the reform 
                bill, the vote on final passage of the reform bill 
                shall occur.
                    (G) Other motions not in order.--A motion to 
                postpone consideration of the reform bill, a motion to 
                proceed to the consideration of other business, or a 
                motion to recommit the reform bill is not in order. A 
                motion to reconsider the vote by which the reform bill 
                is agreed to or not agreed to is not in order.
                    (H) Appeals.--Appeals from the decisions of the 
                Chair relating to the application of the rules of the 
                House of Representatives or of the Senate, as the case 
                may be, to the procedure relating to the reform bill 
                shall be decided without debate.
            (2) Consideration by other house.--If, before the passage 
        by one House of the reform bill that was introduced in such 
        House, such House receives from the other House a reform bill 
        as passed by such other House--
                    (A) the reform bill of the other House shall be 
                subject to the same rules as the rules under this 
                section governing the reform bill introduced in the 
                receiving House; and
                    (B) the procedure in the House in receipt of the 
                reform bill of the other House, with respect to the 
                reform bill that was introduced in the House in receipt 
                of the reform bill of the other House, shall be the 
                same as if no reform bill had been received from the 
                other House.
        Upon passage of a reform bill by either House (or upon adoption 
        of an amendment by either House to a reform bill received from 
        the other House), it shall no longer be in order in the House 
        passing such bill (or amendment) to consider any other reform 
        bill under this section.
            (3) Consideration in conference.--
                    (A) Convening of conference.--
                            (i) In general.--Immediately upon a final 
                        passage of the reform bill that results in a 
                        disagreement between the two Houses of Congress 
                        with respect to the bill, the conferees 
                        described in clause (ii) shall be appointed and 
                        a conference convened.
                            (ii) Conferees described.--The conferees 
                        described in this clause are the following:
                                    (I) The Speaker of the House of 
                                Representatives.
                                    (II) The Minority Leader of the 
                                House of Representatives.
                                    (III) The Majority Leader of the 
                                Senate.
                                    (IV) The Minority Leader of the 
                                Senate.
                                    (V) Each member of the Committee on 
                                Ways and Means of the House of 
                                Representatives.
                                    (VI) Each member of the Committee 
                                on Finance of the Senate.
                    (B) Deadline for report.--Not later than 14 days 
                after the date on which conferees are appointed, the 
                conferees shall file a report with the House of 
                Representatives and the Senate resolving the 
                differences between the Houses on the reform bill.
                    (C) Limitation on scope.--A report filed under 
                subparagraph (B) shall be limited to resolution of the 
                differences between the Houses on the reform bill and 
                shall not include any other matter.
                    (D) House consideration.--
                            (i) In general.--Notwithstanding any other 
                        rule of the House of Representatives, it shall 
                        be in order to immediately consider a report of 
                        a committee of conference on the reform bill 
                        filed in accordance with subparagraph (B).
                            (ii) Debate.--Debate in the House of 
                        Representatives on the conference report shall 
                        be limited to the lesser of 50 hours or 7 days, 
                        equally divided and controlled by the Speaker 
                        of the House of Representatives and the 
                        Minority Leader of the House of Representatives 
                        or their designees.
                            (iii) Limitation on motions.--A motion to 
                        further limit debate on the conference report 
                        is not debatable. A motion to recommit the 
                        conference report is not in order, and it is 
                        not in order to move to reconsider the vote by 
                        which the conference report is agreed to or 
                        disagreed to.
                            (iv) Vote on final passage.--A vote on 
                        final passage of the conference report shall 
                        occur immediately at the conclusion or yielding 
                        back of all time for debate on the conference 
                        report.
                    (E) Senate consideration.--
                            (i) In general.--The motion to proceed to 
                        consideration in the Senate of the conference 
                        report shall not be debatable and the reading 
                        of such conference report shall be deemed to 
                        have been waived.
                            (ii) Debate.--Consideration in the Senate 
                        of the conference report on a reform bill shall 
                        be limited to the lesser of 50 hours or 7 days, 
                        equally divided and controlled by the Majority 
                        Leader and the Minority Leader or their 
                        designees.
                            (iii) Limitation on motion to recommit.--A 
                        motion to recommit the conference report is not 
                        in order.
            (4) Rules of the senate and house of representatives.--This 
        subsection is enacted by Congress--
                    (A) as an exercise of the rulemaking power of the 
                Senate and House of Representatives, respectively, and 
                is deemed to be part of the rules of each House, 
                respectively, but applicable only with respect to the 
                procedure to be followed in that House in the case of a 
                bill, and it supersedes other rules only to the extent 
                that it is inconsistent with such rules; and
                    (B) with full recognition of the constitutional 
                right of either House to change the rules (so far as 
                they relate to the procedure of that House) at any 
                time, in the same manner, and to the same extent as in 
                the case of any other rule of that House.

SEC. 11. TERMINATION.

    The Commission shall terminate 30 days after transmitting its 
recommendations pursuant to section 5.

SEC. 12. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated such sums as may be 
necessary for the activities of the Commission. In order to provide 
funding before funds are otherwise specifically appropriated for such 
activities, of the amounts appropriated to the Department of the 
Treasury under the account ``Departmental Offices--Salaries and 
Expenses'' there is hereby transferred to the Commission $2,000,000 for 
such activities, which amount shall remain available until expended.
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