[Congressional Record Volume 166, Number 213 (Wednesday, December 16, 2020)]
[Senate]
[Pages S7544-S7553]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTION
By Mr. CARDIN:
S. 5031. A bill to amend the Internal Revenue Code of 1986 to provide
for a progressive consumption tax and to reform the income tax, and for
other purposes; to the Committee on Finance.
Mr. CARDIN. Mr. President, today I introduced the Progressive
Consumption Tax Act of 2020.
We need a tax code that is fair for American families and for
employers. We need a tax code that rethinks how our Nation collects the
revenue that allows us to build our roads and bridges and keeps our
Nation safe. We need a system that values our most vulnerable
Americans, small businesses, and makes our U.S.-based businesses more
competitive.
In our recent history, comprehensive tax reform has been out of
grasp. Congressional leaders have long called for a 1986-style tax
reform in which the tax code would be streamlined and simplified to
broaden the tax base and lower income tax rates. The 2017 tax law was a
representation of how hard this type of tax reform is. It kept in place
much of what makes the tax code complicated and inefficient, did not
secure permanent income tax rate reductions for working families, and
it increased the deficit by nearly $2 trillion. It is time we take a
new approach.
As we look to the future and work towards the goal of a sustainable
economy that works for all, my colleagues and I will need to think
creatively about how to raise revenues and provide for the services the
government must and can deliver.
Austere and regressive spending cuts are not the answer to the
question of how to set the country on a sustainable path and support
working families. Instead, we should look at ways to raise reasonable
revenues and make the tax code work better for all. The Progressive
Consumption Tax Act should be part of that conversation.
I introduced versions of this bill in the past to provide an opening
for discussion and an opportunity to review legislative language for
this type of comprehensive tax reform. Now more than ever it is
critical Congress revisit the thinking about comprehensive tax reform
that is lasting and progressive.
The 2017 tax law was constructed with many temporary policies that
will require future action on tax policies as these provisions expire.
While some of those will be years from now, this conversation can
never start early enough. We know that good ideas can take time to
become mainstream. In a world where about 150 countries now have a
consumption tax, it is time the U.S. join this mainstream thinking.
The legislation I have introduced today is an example of truly
progressive, fiscally responsible, pro-growth tax reform could look
like.
It also provides an opportunity for the U.S. to catch up with the
rest of the world. All OECD countries except the U.S. have a
consumption tax.
The Progressive Consumption Tax Act would put this country on a level
playing field by providing for a progressive consumption tax, or PCT,
at a rate of 10 percent. The PCT would generate revenue by taxing goods
and services, rather than income.
The revenues collected by the PCT would eliminate an income tax
liability for most households in this Nation. Lower income individuals,
those currently eligible for the Earned Income Tax Credit and the Child
Tax Credit, would receive rebates to cover the cost of their PCT
burden, cementing the progressivity of this new system.
For those who do still have an income tax liability under this Act
would have lower rates and a simplified income tax. Under current law,
the top marginal income tax rate is 37 percent. Under the Progressive
Consumption Tax Act, the top income rate would be just 28 percent.
The 2017 tax law reduced the corporate tax rate to 21 percent. This
Act would further reduce that rate to 17 percent. Businesses would be
more competitive and this would contribute to a pro-growth economy in
the U.S., all while collecting reasonable revenues.
As we discuss this proposal, you will hear me say this over and over
again: An overarching goal of the Progressive Consumption Tax Act is
ensuring the tax code is progressive, meaning that those who make less
in income don't have a higher tax burden than wealthy people. The
provisions included in this Act--removing an income tax liability for
most households and providing rebates--are meant to maintain
progressivity in the tax code for families.
For those who worry that a consumption tax will bring in ``too much''
money, my legislation remains balanced. It is designed to raise stable
and reasonable tax revenues. However, if more revenues than envisioned
are collected under this legislation, a ``circuit breaker'' would
return additional revenues to taxpayers. Again, we put money back into
the hands of the taxpayers.
In 2017, I offered the Progressive Consumption Tax Act as an
alternative to the tax legislation considered that year. While it would
have been a responsible choice to enact then, it could still provide a
fresh start now.
Since that law was passed, there has been increased interest in
looking at ways to reform the nation's tax laws to tilt any benefit
more towards those who were left behind and raise reasonable revenues.
My colleagues in Congress and stakeholders are searching for forward-
looking ideas for how to modernize the tax code. I am excited that
President-elect Biden has put forward tax reform proposals and
Congressional leaders have done the same. The longer we wait to put
this country in a better, more competitive, progressive position, the
harder it will be.
That's why I am reintroducing the Progressive Consumption Tax this
year. As this Congress closes and the new Congress convenes, I hope we
will seriously consider the tax system in this country and consider the
types of reforms proposed in the Progressive Consumption Tax Act.
Mr. President, I ask unanimous consent that the text of my bill
appear in the Record following these remarks.
S. 5031
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE, ETC.
(a) In General.--This Act may be cited as the ``Progressive
Consumption Tax Act of 2020''.
(b) Reference.--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.
(c) Table of Contents.--The table of contents of this Act
is as follows:
Sec. 1. Short title, etc.
TITLE I--PROGRESSIVE CONSUMPTION TAX
Sec. 101. Imposition of progressive consumption tax.
TITLE II--INDIVIDUAL AND CORPORATE TAX REFORM
Subtitle A--Individual Income Tax Reforms
Sec. 201. Individual income tax rate reductions and inflation
adjustments.
Sec. 202. Family allowance amounts; repeal of personal exemption
deduction.
Sec. 203. Repeal of limitations relating to itemized deductions.
Sec. 204. Restoration of certain deductions.
Sec. 205. Termination of separate treatment of capital gains.
Sec. 206. Repeals.
Sec. 207. Establishment of progressive tax rebate.
Sec. 208. Technical and conforming amendments.
Subtitle B--Corporate Tax Reforms
Sec. 211. Corporate income tax rate reduction.
TITLE III--REFUND OF EXCESS CONSUMPTION TAX REVENUE
Sec. 301. Refunds of excess consumption tax revenue.
TITLE I--PROGRESSIVE CONSUMPTION TAX
SEC. 101. IMPOSITION OF PROGRESSIVE CONSUMPTION TAX.
(a) In General.--Subtitle D is amended by inserting before
chapter 31 the following new chapter:
[[Page S7545]]
``CHAPTER 30--PROGRESSIVE CONSUMPTION TAX
``subchapter a. imposition of tax
``subchapter b. taxable supply
``subchapter c. credit against tax
``subchapter d. administration
``subchapter e. definitions and special rules
``Subchapter A--Imposition of Tax
``Sec. 3901. Imposition of tax.
``Sec. 3902. Taxable amount.
``SEC. 3901. IMPOSITION OF TAX.
``(a) General Rule.--A tax is hereby imposed on every
taxable supply.
``(b) Amount of Tax.--
``(1) In general.--Except as provided in paragraph (2), the
amount of the tax shall be 10 percent of the taxable amount.
``(2) Special rate for exports.--The amount of the tax
shall be zero with respect to the provision of any supply
which is--
``(A) a supply of tangible personal property that is
exported from the United States within 90 days after the
provider gives an invoice for the supply, or
``(B) a supply, other than a supply of tangible personal
property--
``(i) which is provided to a recipient that is not in the
United States when the supply is performed or otherwise done,
and
``(ii) the use of which takes place outside of the United
States.
``SEC. 3902. TAXABLE AMOUNT.
``(a) Amount Charged Customer.--For purposes of this
chapter, the taxable amount for any taxable supply for which
money is the only consideration shall be the price charged by
the provider--
``(1) including all invoiced charges for transportation,
and other items payable to the provider with respect to the
supply, but
``(2) excluding the tax imposed by section 3901 with
respect to the supply and excluding any State and local sales
and use taxes with respect to the supply.
``(b) Barter Transactions.--For purposes of this chapter,
the taxable amount for any taxable supply which includes
consideration other than money shall be the fair market value
of the consideration (including all invoiced charges for
transportation and other items payable to the provider) plus
the amount of any money paid in consideration.
``(c) Imports.--For purposes of this chapter, the taxable
amount in the case of any import shall be--
``(1) the customs value plus customs duties and any other
duties which may be imposed, or
``(2) if there is no such customs value, the fair market
value (determined as if the importer had sold the supply).
For purposes of this subsection, the customs value of any
import shall include all invoiced charges for transportation
and other items payable to the importer with respect to the
supply.
``(d) Special Rule in the Case of Sales of Certain Used
Consumer Goods.--For purposes of this chapter, if--
``(1) a person acquires any tangible personal property in a
transaction which was not taxable under this chapter, and
``(2) such property had been used by an ultimate consumer
before such acquisition,
the taxable amount in the case of any sale of such property
by such person (determined without regard to this subsection)
shall be reduced by the amount paid for such property by such
person.
``Subchapter B--Taxable Supply
``Sec. 3911. Taxable supply.
``Sec. 3912. Supplies made in connection with the United States.
``Sec. 3913. Exempt supply.
``SEC. 3911. TAXABLE SUPPLY.
``(a) In General.--For purposes of this chapter, the term
`taxable supply' means--
``(1) the importation of property into the United States,
and
``(2) any supply (other than an exempt supply)--
``(A) which is provided--
``(i) in the course of carrying on a trade or business,
``(ii) in the case of an organization exempt from tax under
section 501(a), in furtherance of the activities related to
the purpose or function constituting the basis of its
exemption under section 501, or
``(iii) in the case of a State, an Indian tribal
government, a possession of the United States, or any
political subdivision of any of the foregoing, or the United
States or the District of Columbia, in carrying out any
activity that is not an essential governmental function,
``(B) for which consideration is provided in return, and
``(C) which is made in connection with the United States.
``(b) Supply.--For purposes of this chapter--
``(1) In general.--The term `supply' means any supply
whatsoever, including--
``(A) the sale or provision (including through renting,
leasing, or licensing) of property,
``(B) the performance of services,
``(C) the grant, assignment, or surrender of real property,
``(D) the creation, grant, transfer, assignment, or
surrender of any right,
``(E) financial supplies, and
``(F) an entry into, or release from, an obligation or
agreement to perform or refrain from performing an act.
``(2) Special rule for services for employer.--An
employee's services for the employee's employer shall not be
treated as a supply.
``SEC. 3912. SUPPLIES MADE IN CONNECTION WITH THE UNITED
STATES.
``(a) Tangible Property.--For purposes of this chapter--
``(1) In general.--The supply of tangible property is made
in connection with the United States if--
``(A) the property is delivered or made available to the
recipient in the United States, or
``(B) the property is assembled in or removed from any
location in the United States.
``(2) Real property.--The supply of real property is made
in connection with the United States if the real property is
located in the United States.
``(b) Services, Intangible Property, and Other Supplies.--
For purposes of this chapter, the supply of anything other
than tangible property or real property is made in connection
with the United States if--
``(1) the supply is used, performed, or otherwise done in
the United States, or
``(2) the supply is provided through a trade or business in
the United States.
``SEC. 3913. EXEMPT SUPPLY.
``(a) In General.--An exempt supply shall not be subject to
tax under this chapter.
``(b) Exempt Supply.--For purposes of this chapter--
``(1) In general.--The term `exempt supply' means--
``(A) the rental or leasing of residential real property,
``(B) any sale of qualified residential real property,
``(C) any financial supply,
``(D) any nonparticipating small supplier supply, and
``(E) any taxable supply (or category of such supplies)
treated as an exempt supply under section 3932(b).
``(2) Qualified residential real property.--For purposes of
paragraph (1), the term `qualified residential real property'
means residential real property--
``(A) which--
``(i) has previously been sold as residential real
property, or
``(ii) has been continuously rented for 5 years or more,
and
``(B) to which substantial renovations have not been made
after the date of the enactment of this chapter.
``(3) Nonparticipating small supplier supply.--
``(A) In general.--For purposes of paragraph (1), the term
`nonparticipating small supplier supply' means any supply
provided by a supplier during--
``(i) any taxable period during which such supplier was a
nonparticipating small supplier, or
``(ii) the four-week period beginning on the first day
after the close of the last calendar quarter in which such
supplier was a nonparticipating small supplier.
``(B) Nonparticipating small supplier.--
``(i) In general.--For purposes of subparagraph (A), the
term `nonparticipating small supplier' means any person for
any taxable period if--
``(I) such person has aggregate taxable revenues of not
more than $100,000 for the four-calendar quarter period
ending immediately before the taxable period, and
``(II) has not made an election under clause (iii) for such
taxable period.
``(ii) Taxable revenue.--For purposes of this paragraph,
the term `taxable revenue' means revenue from supplies which
are taxable supplies, determined without regard to paragraph
(1)(D).
``(iii) Election.--Under regulations prescribed by the
Secretary, any person who meets the requirements of clause
(i)(I) may make an election not to be treated as a
nonparticipating small supplier for any taxable period.
``(C) Aggregation rules.--For purposes of determining
aggregate taxable revenues under subparagraph (B)(i)(I), all
members of the same controlled group of corporations (within
the meaning of section 267(f)) and all persons under common
control (within the meaning of section 52(b) but determined
by treating an interest of more than 50 percent as a
controlling interest) shall be treated as 1 person.
``Subchapter C--Credit Against Tax
``Sec. 3916. Credit against tax.
``SEC. 3916. CREDIT AGAINST TAX.
``(a) General Rule.--There shall be allowed as a credit
against the aggregate amount of tax imposed by section 3901
with respect to all taxable supplies made by the taxpayer
during the taxable period an amount equal to the aggregate
amount of tax imposed by section 3901 on creditable
acquisitions of the taxpayer during such taxable period.
``(b) Creditable Acquisitions.--For purposes of this
chapter, the term `creditable acquisition' means the
acquisition or receipt of any supply which--
``(1) was subject to tax under section 3901 at the time it
was provided to the taxpayer,
``(2) was used by the taxpayer--
``(A) in the course of carrying on a trade or business,
``(B) in the case of a taxpayer exempt from tax under
section 501(a), in furtherance of the activities related to
the purpose or function constituting the basis of the
exemption under section 501, or
``(C) in the case of a State, an Indian tribal government,
a possession of the United
[[Page S7546]]
States, or any political subdivision of any of the foregoing,
or the United States or the District of Columbia, in carrying
out any activity that is not an essential governmental
function, and
``(3) except as provided in subsection (c), was not used by
the taxpayer to make an exempt supply.
``(c) Certain Acquisitions Related to Financial Supplies.--
``(1) Acquisitions by qualified small financial
suppliers.--
``(A) In general.--Solely for purposes of subsections
(b)(3) and (d)(1), a financial supply which is provided by a
qualified small financial supplier shall not be treated as an
exempt supply.
``(B) Qualified small financial supplier.--
``(i) In general.--For purposes of this paragraph, the term
`qualified small financial supplier' means any person for any
month if, for the 12-month period ending with the month
preceding such month, the amount of credits which, but for
this paragraph, would be allowable to such person under
subsection (a) for taxable supplies which are used for the
purpose of making financial supplies does not exceed the
lesser of--
``(I) $150,000, or
``(II) 10 percent of the amount of credits allowable to
such person under subsection (a) (determined without regard
to this paragraph) for all taxable supplies during such 12-
month period.
``(ii) Aggregation rules.--For purposes of determining the
amount of credits for any period under clause (i), all
members of the same controlled group of corporations (within
the meaning of section 267(f)) and all persons under common
control (within the meaning of section 52(b) but determined
by treating an interest of more than 50 percent as a
controlling interest) shall be treated as 1 person.
``(2) Partially creditable acquisitions.--
``(A) In general.--In the case of any partially creditable
acquisition by a person other than a qualified small
financial supplier--
``(i) subsection (b) shall be applied without regard to
paragraph (3) thereof, and
``(ii) only 60 percent of the amount of tax imposed by
section 3901 shall be taken account under subsection (a) in
determining the amount of the credit under this section.
``(B) Partially creditable acquisition.--For purposes of
this section--
``(i) In general.--The term `partially creditable
acquisition' means the acquisition of any supply described in
clause (ii) if such acquisition is used to provide a
financial supply.
``(ii) Supplies described.--A supply is described in this
clause if such supply is a supply of--
``(I) banking or cash management services, including
services related to issuing, closing, operating, and
maintaining accounts, and the processing of account
information and applications,
``(II) payment and fund transfer services, including for
the operation of a payment system and processing account
transactions,
``(III) securities transaction services for the provision,
acquisition, or disposal of an interest in a security,
``(IV) loan and debt collection services, including
mortgage brokerage services, services related to mortgage
insurance and loan protection insurance, and loan
application, management, and processing services,
``(V) capital markets, financial instruments, or fund
management services,
``(VI) insurance services, including brokerage services, or
``(VII) such other services as the Secretary may specify in
regulations.
``(d) Exempt Supplies, etc.--
``(1) In general.--If acquisitions (other than partially
creditable acquisitions) are used partly for a use which is
not for an exempt supply and partly for an exempt supply, the
credit shall be allowable only with respect to the
acquisitions which are not used for an exempt supply.
``(2) Partially creditable acquisitions.--If partially
creditable acquisition is used partly to provide a supply
described in subsection (c)(2)(B)(ii) and partly for another
use, subsection (c)(2) shall apply only with respect to
acquisitions used to provide supplies described in subsection
(c)(2)(B)(ii).
``(e) Excess Credit Treated as Overpayment.--
``(1) In general.--If for any taxable period the amount of
the credit allowable by subsection (a) exceeds the aggregate
amount of the tax imposed by section 3901 for such period,
such excess shall be treated as an overpayment of the tax
imposed by section 3901.
``(2) Time when overpayment arises.--Any overpayment under
paragraph (1) for any taxable period shall be treated as
arising on the later of--
``(A) the due date for the return for such period, or
``(B) the date on which the return is filed.
``Subchapter D--Administration
``Sec. 3921. Provider liable for tax.
``Sec. 3922. Tax invoices.
``Sec. 3923. Time for filing return and claiming credit; deposits of
tax.
``Sec. 3924. Treatment of related businesses, etc.
``Sec. 3925. Reports.
``Sec. 3926. Regulations.
``SEC. 3921. PROVIDER LIABLE FOR TAX.
``(a) In General.--Except as provided in subsection (b),
the person providing the supply shall be liable for the tax
imposed by section 3901.
``(b) Special Rule for Imports.--The person receiving the
supply shall be liable for the tax imposed under section
3901--
``(1) in the case of any taxable supply described in
section 3911(a)(1), and
``(2) in the case of any taxable supply which is not a
supply of tangible property and which is--
``(A) performed or otherwise done outside the United
States,
``(B) used in the United States, and
``(C) acquired for use--
``(i) in carrying on a trade or business in the United
States,
``(ii) by an organization exempt from tax under section
501(a), in furtherance of activities related to the purpose
or function constituting the basis of its exemption under
section 501, or
``(iii) by a State, an Indian tribal government, a
possession of the United States, or any political subdivision
of any of the foregoing, or the United States or the District
of Columbia, in carrying out any activity that is not an
essential governmental function.
``SEC. 3922. TAX INVOICES.
``(a) In General.--
``(1) Supplies made in connection with the united states.--
Except as otherwise provided in this subsection, any person
providing a taxable supply shall give the recipient a tax
invoice with respect to such supply.
``(2) Certain services performed outside the united
states.--In the case of any taxable supply described in
section 3921(b)(2), paragraph (1) shall not apply and the
person receiving the taxable supply shall generate a tax
invoice with respect to such supply.
``(3) Imports.--In the case of any taxable supply described
in section 3911(a), the Secretary, in consultation with the
Commissioner of Customs and Border Protection, shall
promulgate regulations governing the provision of tax
invoices.
``(b) Content of Invoice.--The tax invoice required by
subsection (a) with respect to any supply shall set forth--
``(1) the name and, in the case of an invoice under
subsection (a)(1), identification number of the provider,
``(2) the name of the recipient,
``(3) the date of the taxable supply,
``(4) the taxable amount with respect to the taxable
supply,
``(5) the amount of the tax imposed by section 3901, and
``(6) such other information as may be prescribed by
regulations.
``(c) No Credit Without Invoice.--
``(1) In general.--Except as provided in paragraph (2) or
(3), a taxpayer may claim a credit with respect to a
creditable acquisition only if the taxpayer--
``(A) has in the taxpayer's possession a tax invoice which
meets the requirements of this section, and
``(B) is named as the recipient of the supply in such
invoice.
``(2) Employees or other agents named in invoices.--To the
extent provided in regulations, the naming of an employee or
other agent of the recipient of the supply shall be treated
as the naming of the recipient.
``(3) Waiver of invoice requirement in certain cases.--To
the extent provided in regulations, paragraph (1) shall not
apply--
``(A) where the taxpayer can demonstrate that the failure
to receive or to have in the taxpayer's possession a tax
invoice was without fault on the taxpayer's part, or
``(B) to a taxable supply (or category of supplies) where--
``(i) the amount involved is de minimis, or
``(ii) the information required by subsection (b) can be
reliably established by sampling or by another method and can
be adequately documented.
``(d) Time for Furnishing Invoice.--Any invoice required to
be furnished by subsection (a) with respect to any supply
shall be furnished not later than 15 business days after the
tax point for such supply.
``SEC. 3923. TIME FOR FILING RETURN AND CLAIMING CREDIT;
DEPOSITS OF TAX.
``(a) Filing Return.--Before the last day of the fourth
week (third week, in the case of any taxpayer to which
subsection (c)(2) applies) after the close of each taxable
period, each person liable for tax under this chapter shall
file a return of the tax imposed by section 3901 on taxable
supplies having a tax point within such taxable period.
``(b) Credit Allowed for Taxable Period in Which Recipient
Receives Invoice.--
``(1) In general.--Except as provided in paragraph (2), a
credit allowable by section 3916 with respect to a supply may
be allowed only for the first taxable period by the close of
which the taxpayer--
``(A) has paid or accrued amounts properly allocable to the
tax imposed by section 3901 with respect to such supply, and
``(B) has a tax invoice (or equivalent) with respect to
such supply.
``(2) Use for later period.--Under regulations, a credit
allowable by section 3916 may be allowed for a period after
the period set forth in paragraph (1).
``(c) Taxable Period.--For purposes of this chapter--
``(1) In general.--Except as provided in paragraph (2), the
term `taxable period' means a calendar quarter.
``(2) Monthly period for certain taxpayers.--
``(A) In general.--In the case of a taxpayer who makes
taxable supplies for any month in
[[Page S7547]]
excess of $20,000,000, the term `taxable period' means a
calendar month.
``(B) Election of 1-month period.--If the taxpayer so
elects, the term `taxable period' means a calendar month.
``(d) Tax Point.--For purposes of this chapter--
``(1) Chapter 1 rules with respect to provider govern.--
Except as provided in paragraph (2), the tax point for any
supply is the earlier of--
``(A) the time (or times) when any income from the
provision of the supply should be treated by the provider as
received or accrued (or any loss should be taken into account
by the seller) for purposes of chapter 1, or
``(B) the time (or times) when the provider receives
payment for the sale.
``(2) Imports.--In the case of the importing of property,
the tax point is when the property is entered, or withdrawn
from warehouse, for consumption in the United States.
``(e) Monthly Deposits Required.--To the extent provided in
regulations, monthly deposits may be required of the
estimated liability for any taxable period for the tax
imposed by section 3901.
``SEC. 3924. TREATMENT OF RELATED BUSINESSES, ETC.
``For purposes of this chapter, except as provided in
sections 3913(b)(3)(C) and 3916(c)(1)(B)(ii) and in
regulations established by the Secretary, the taxpayer may
elect--
``(1) to treat as 1 person 2 or more businesses which may
be treated under section 52(b) as 1 employer, and
``(2) to treat as separate persons separate divisions of
the same business.
``SEC. 3925. REPORTS.
``The Secretary shall submit to Congress semi-annual
reports on the implementation and administration of this
chapter, including the amount of revenue collected from the
tax imposed under this chapter and estimates of the revenue
to be collected from such tax for future period.
``SEC. 3926. REGULATIONS.
``The Secretary shall prescribe such regulations as may be
necessary to carry out the purposes of this chapter.
``Subchapter E--Definitions and Special Rules
``Sec. 3931. Definitions.
``Sec. 3932. Special rules.
``SEC. 3931. DEFINITIONS.
``For purposes of this chapter--
``(1) Business.--The term `business' includes--
``(A) a trade, and
``(B) an activity regularly carried on for profit.
``(2) Business day.--The term `business day' means any day
other than Saturday and Sunday and other than a legal holiday
(within the meaning of section 7503).
``(3) Employee.--The term `employee' has the meaning such
term has for purposes of chapter 24.
``(4) Financial supplies.--The term `financial supplies'
means the provision, acquisition, or disposal of any of the
following: a bank account, a debit or credit arrangement, a
mortgage, a superannuation fund, an annuity, insurance, a
financial guarantee, an indemnity, currency, securities, or
derivatives.
``(5) Person.--The term `person' includes any governmental
entity.
``(6) Provide; provider.--The term `provide', when used in
reference to taxable supplies (other than in section
3911(a)(2)), includes the importation of property and the
term `provider' includes the importer of property.
``(7) United states.--The term `United States', when used
in a geographical sense, includes a Commonwealth and any
possession of the United States.
``SEC. 3932. SPECIAL RULES.
``(a) Coordination With Subtitle A.--For purposes of
subtitle A--
``(1) Treatment of credit.--Any credit allowable to a
taxpayer under section 3916 which is attributable to any
supply shall be treated as a reduction in the amount paid or
incurred by the taxpayer for such supply.
``(2) Amount of deduction for tax.--The amount allowable as
a deduction for the tax imposed by section 3901 shall be
determined without regard to any credit allowable under
section 3916.
``(3) Computation of percentage depletion.--For purposes of
sections 613 and 613A--
``(A) gross income shall be reduced by the amount of the
tax imposed by section 3901, and
``(B) taxable income shall be determined without regard to
any deduction allowed for such tax.
``(b) Authority to Zero Rate De Minimis Supplies, etc.--The
Secretary may prescribe regulations treating as an exempt
supply any taxable supply (or category of such supplies)
where--
``(1) the amount involved is de minimis, or
``(2) the revenue raised by taxing the supply is not
sufficient to justify the administrative and other costs
involved in the payment and collection of the tax.''.
(b) Clerical Amendment.--The table of chapters for subtitle
D is amended by inserting before the item relating to chapter
31 the following:
``Chapter 30. Progressive Consumption Tax''.
(c) Effective Date.--The amendments made by this section
shall apply to supplies provided after December 31, 2021.
TITLE II--INDIVIDUAL AND CORPORATE TAX REFORM
Subtitle A--Individual Income Tax Reforms
SEC. 201. INDIVIDUAL INCOME TAX RATE REDUCTIONS AND INFLATION
ADJUSTMENTS.
(a) In General.--
(1) Married individuals filing joint returns and surviving
spouses.--Subsection (a) of section 1 is amended by striking
the table and inserting the following:
The tax is:e income is:
15 percent of taxable income...........................................
$15,000, plus 25 percent of the excess over $100,000...................
$115,000, plus 28 percent of the excess over $500,000.''...............
(2) Heads of households.--Subsection (b) of section 1 is
amended by striking the table and inserting the following:
The tax is:e income is:
15 percent of taxable income...........................................
$7,500, plus 25 percent of the excess over $50,000.....................
$57,500, plus 28 percent of the excess over $250,000.''................
(3) Unmarried individuals (other than surviving spouses and
heads of households).--Subsection (c) of section 1 is amended
by striking the table and inserting the following:
The tax is:e income is:
15 percent of taxable income...........................................
$7,500, plus 25 percent of the excess over $250,000....................
$57,500, plus 28 percent of the excess over $250,000.''................
(4) Married individuals filing separate returns.--
Subsection (d) of section 1 is amended by striking the table
and inserting the following:
The tax is:e income is:
15 percent of taxable income...........................................
$7,500, plus 25 percent of the excess over $250,000....................
$57,500, plus 28 percent of the excess over $250,000.''................
(5) Conforming amendments.--Section 1 is amended by
striking subsections (i) and (j).
(b) Inflation Adjustments Applied Based on CPI.--Paragraph
(3) of section 1(f) is amended to read as follows:
``(3) Cost-of-living adjustment.--For purposes of this
subsection--
``(A) In general.--The cost-of-living adjustment for any
calendar year is the percentage (if any) by which--
``(i) the CPI for the preceding calendar year, exceeds
``(ii) the CPI for calendar year 2016, multiplied by the
amount determined under subparagraph (B).
``(B) Amount determined.--The amount determined under this
subparagraph is the product of--
``(i) the amount obtained by dividing--
``(I) the C-CPI-U for calendar year 2016, by
``(II) the CPI for calendar year 2016, and
``(ii) the amount obtained by dividing--
``(I) the CPI for calendar year 2021, by
``(II) the C-CPI-U for calendar year 2021.
``(C) Special rule for adjustments with a base years after
2016.--
``(i) Base years after 2021.--For purposes of any provision
of this title which provides for the substitution of a year
after 2021 for `2016' in subparagraph (A)(ii), such
subparagraph shall be applied without regard to `, multiplied
by the amount determined under subparagraph (B)'.
``(ii) Base years after 2016 and before 2022.--For purposes
of any provision of this title which provides for the
substitution of a year after 2016 and before 2021 for `2016'
in subparagraph (A)(ii)--
``(I) subparagraph (A)(ii) shall be applied by substituting
`C-CPI-U' for `CPI', and
``(II) the amount determined under subparagraph (B) shall
be the amount obtained by dividing--
``(aa) the CPI for calendar year 2021, by
``(bb) the C-CPI-U for calendar year 2021.''.
(c) Conforming Amendments Related to Rate Changes.--
(1) In general.--Paragraph (3) of section 1(f) is amended
by inserting ``, except as provided in paragraph (7),'' after
``for any calendar year''.
(2) Updated cost-of-living adjustment for new rates.--
Section 1(f) is amended by striking paragraphs (8) and
inserting the following:
``(8) Cost-of-living adjustment for years after 2021.--
``(A) Calendar year 2022.--In prescribing the tables under
paragraph (1) which apply in lieu of the tables contained in
subsections (a), (b), (c), and (d) with respect to taxable
years beginning in calendar year 2022, the Secretary shall
make no adjustment to the dollar amounts in any such table.
``(B) Later calendar years.--In prescribing tables under
paragraph (1) which apply in lieu of the tables contained in
subsections (a), (b), (c), and (d) with respect to taxable
years beginning after December 31, 2022, the cost-of-living
adjustment used in making adjustments to the dollar amounts
in such tables shall be determined under paragraph (3) by
substituting `2021' for `2016' in subparagraph (A)(ii)
thereof.''.
(3) Other conforming amendments.--
(A) Paragraph (2) of section 1(f) is amended--
[[Page S7548]]
(i) by striking ``paragraph (8)'' in subparagraph (A) and
inserting ``paragraph (7)(A)'', and
(ii) by striking ``by adjusting'' in subparagraph (C) and
inserting ``except as provided in paragraph (7)(A), by
adjusting''.
(B) The heading of subsection (f) of section 1 is amended
by striking ``Phaseout of Marriage Penalty in 15-Percent
Bracket; Adjustments'' and inserting ``Adjustments''.
(d) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2021.
SEC. 202. FAMILY ALLOWANCE AMOUNTS; REPEAL OF PERSONAL
EXEMPTION DEDUCTION.
(a) Family Allowance Amount.--
(1) In general.--Section 63 is amended to read as follows:
``SEC. 63. TAXABLE INCOME DEFINED.
``(a) In General.--For purposes of this subtitle, the term
`taxable income' means adjusted gross income minus--
``(1) the deductions allowed by this chapter (other than
those taken into account in determining adjusted gross
income), and
``(2) the family allowance amount.
``(b) Family Allowance Amount.--For purposes of this
subtitle--
``(1) In general.--The family allowance amount with respect
to a taxpayer shall be determined in accordance with the
following table:
The family
``If the taxpayer is: allowance
amount is:
Single or married filing separately................. $50,000
Married filing jointly or a surviving spouse........ $100,000
A head of a household............................... $75,000.
``(2) Definitions.--For purposes of this subsection--
``(A) the term `single or married filing separately' means
a taxpayer to whom subsection (c) or (d) of section 1
applies,
``(B) the term `married filing jointly or a surviving
spouse' means a taxpayer to whom subsection (a) of section 1
applies, and
``(C) the term `head of a household' means a taxpayer to
whom subsection (b) of section 1 applies.
``(3) Adjustment for inflation.--In the case of any taxable
year beginning after 2022, each of the dollar amounts in the
table under paragraph (1) shall be increased by an amount
equal to--
``(A) such dollar amount, multiplied by
``(B) the cost-of-living adjustment determined under
section 1(f)(3) for the calendar year in which the taxable
year begins, by substituting `2021' for `2016' in
subparagraph (A)(ii) thereof.
``(c) Cross References.--
``(1) For deductions of estates and trusts in lieu of the
family allowance amount, see section 642(b).
``(2) For calculation of family allowance relating to
nonresident aliens, see section 873(b)(3).
``(3) For determination of marital status, see section
7703.''.
(2) Application of family allowance to certain rules.--
(A) Source rules.--
(i) Section 861(b) is amended by striking ``the standard
deduction'' and inserting ``the family allowance''.
(ii) Section 862(b) is amended by striking ``the standard
deduction'' and inserting ``the family allowance''.
(B) Threshold for requirement to make return.--
(i) Section 6012(a)(1) is amended to read as follows:
``(1)(A) Every individual--
``(i) having for the taxable year gross income which equals
or exceeds the family allowance amount applicable to the
individual under section 63, or
``(ii) in the case of individuals entitled to make a joint
return (but only if the individual and the individual's
spouse had the same household as their home at the close of
the taxable year), every individual whose gross income, when
combined with the gross income of the individual's spouse,
equals or exceeds the family allowance amount applicable to
taxpayers who are married filing jointly under section 63.
``(B) Every individual not described in subparagraph (A)
who is taken into account as a dependent by another taxpayer
under section 7706 for purposes of any provision of this
title, but only if such individual's gross income, when
combined with the gross income of all individuals taken into
account in determining the family allowance amount under
section 63(b) of the taxpayer, equals or exceeds the family
allowance amount applicable to the taxpayer under such
section.''.
(ii) Section 6012(a)(8) is amended by striking ``is not
less than the sum of the exemption amount plus the basic
standard deduction under section 63(c)(2)(D)'' and inserting
``equals or exceeds the family allowance amount applicable to
the estate under section 1398(c)(3)''.
(iii) Section 6012 is amended by striking subsection (f).
(C) Other rules.--
(i) Section 1398(c) is amended--
(I) by striking paragraph (3) and inserting the following:
``(3) Family allowance amount.--The family allowance amount
under section 63(b) taken into account for the estate for the
taxable year shall be the same as for a taxpayer who is
single or married filing separately.'', and
(II) by striking ``Basic Standard Deduction'' in the
heading and inserting ``Family Allowance Amount''.
(ii) Section 6014 is amended--
(I) by striking ``who dos not itemize his deductions and
who is not described in section 6012(a)(1)(C)(i)'' in
subsection (a) and inserting ``who is not described in
section 6012(a)(1)(B)'', and
(II) by striking subsection (b)(4) and inserting the
following:
``(4) to cases where the taxpayer claims deductions in
addition to the family allowance.''.
(b) Permanent Repeal of Deduction for Personal
Exemptions.--
(1) In general.--Part V of subchapter B of chapter 1 is
hereby repealed.
(2) Definition of dependent retained.--
(A) In general.--Section 152, prior to the repeal made by
subsection (a), is hereby redesignated as section 7706 and
moved to the end of chapter 79.
(B) Identifying information required to treat individual as
dependent.--Section 7706, as redesignated by subparagraph
(A), is amended by adding at the end the following new
subsection:
``(g) Identifying Information Required.--No individual
shall be treated as a dependent of the taxpayer under this
section for a taxable year unless the taxpayer includes the
TIN of such individual on the return of tax for the taxable
year.''.
(3) Application of repeal to certain rules.--
(A) Determination of dependent.--Section 7706, as
redesignated by subparagraph (A), is amended--
(i) in subsection (d)--
(I) by striking ``the exemption amount (as defined in
section 151(d))'' in subparagraph (1)(B) and inserting
``$4,150'', and
(II) by adding at the end the following new paragraph:
``(6) Inflation adjustment.--In the case of any taxable
year beginning in a calendar year beginning after 2018, the
$4,150 amount in paragraph (1)(B) shall be increased by an
amount equal to--
``(A) such dollar amount, multiplied by
``(B) the cost-of-living adjustment determined under
section 1(c)(2)(A) for the calendar year in which such
taxable year begins, determined by substituting `calendar
year 2017' for `calendar year 2016' in clause (ii)
thereof.'', and
(ii) in subsection (f)(6)(B)(i), by striking ``the
deduction under section 151(c)'' and inserting ``the family
allowance amount under section 63(b)''.
(B) Net operating loss.--Section 172(d)(3) is amended to
read as follows:
``(3) Family allowance amount.--Taxable income under
section 63 shall be determined without regard to paragraph
(2) of section 63(a), relating to the family allowance
amount. No deduction in lieu of such family allowance amount
shall be allowed.''.
(C) Short taxable years.--
(i) Section 443(c) is amended--
(I) by striking ``the exemptions allowed as a deduction
under section 151 (and any deduction in lieu thereof) shall
be reduced to amounts which bear the same ratio to the full
exemptions'' and inserting ``the family allowance amount
under section 63 (and any deduction in lieu thereof) shall be
reduced to an amount which bears the same ratio to the full
family allowance amount'', and
(II) by striking ``Deduction for Personal Exemptions'' in
the heading and inserting ``Family Allowance Amount''.
(ii) Section 441(f)(2)(B)(iii) is amended by striking ``of
the deductions for personal exemptions as described in
section 443(c)'' and inserting ``of the family allowance
amount''.
(D) Application to trusts and estates.--
(i) Section 642(b)(2)(C) is amended--
(I) by striking ``the exemption amount under section
151(d)'' in clause (i) and inserting ``the dollar amount in
effect under section 7706(d)(1)(B)'', and
(II) by striking clause (iii).
(ii) Section 642(b)(3) is amended--
[[Page S7549]]
(I) by striking ``the deductions allowed under section 151
(relating to deduction for personal exemption)'' and
inserting ``the family allowance amount'', and
(II) by striking ``personal exemption'' in the heading and
inserting ``family allowance amount''.
(E) Partnership computations.--Section 703(a) is amended--
(i) by striking ``and'' at the end of paragraph (1),
(ii) by striking subparagraph (A) of paragraph (2) and by
redesignating subparagraphs (B), (C), (D), (E), and (F) of
such paragraph as subparagraphs (A), (B), (C), (D), and (E),
(iii) by striking the period at the end of paragraph (2)(F)
and inserting ``, and'', and
(iv) by adding at the end the following new paragraph:
``(3) taxable income under section 63 shall be determined
without regard to the family allowance amount.''.
(F) Nonresident aliens.--
(i) Section 873(b) is amended--
(I) by striking ``deductions'' in the matter preceding
paragraph (1), and
(II) by striking paragraph (3) and inserting the following:
``(3) Family allowance amount.--The family allowance amount
under section 63(a)(2), except that the taxpayer shall be
treated for purposes of section 63(b) as single or married
filing separately unless the taxpayer is a resident of a
contiguous country or is a national of the United States.''.
(ii)(I) The heading of section 873 is amended by striking
``deductions'' and inserting ``deductions and allowances''.
(II) The item relating to section 873 in the table of
sections for subpart A of part II of subchapter N of chapter
1 is amended to read as follows:
``Sec. 873. Deductions and allowances.''.
(iii) Section 874(b) is amended by striking ``deduction for
exemptions under section 151'' and inserting ``the family
allowance amount under section 63''.
(iv) Section 891 is amended by striking ``deductions
allowable under section 151 and under'' and inserting ``the
family allowance amount under section 63(a)(2) and the
deductions allowable under''.
(G) Foreign tax credit.--Section 904(b)(1) is amended to
read as follows:
``(1) Family allowance and deductions.--For purposes of
subsection (a), the taxable income in the case of an
individual, estate, or trust shall be computed without regard
to the family allowance amount under section 63(a)(2) or any
deduction in lieu of such amount under section 642(b)(3).''.
(H) Treatment of possessions.--
(i) Section 931(b)(1) is amended by striking ``the
deduction under section 151, relating to personal
exemptions'' and inserting ``the family allowance amount
under section 63(c)''.
(ii) Section 933 is amended--
(I) by striking ``the deduction under section 151, relating
to personal exemptions'' in paragraph (1) and inserting ``the
family allowance amount under section 63(c)'', and
(II) by striking ``the deduction for personal exemptions
under section 151'' in paragraph (2) and inserting ``the
family allowance amount under section 63(c)''.
(I) Capital losses.--Section 1212(b)(2)(B)(ii) is amended
to read as follows:
``(ii) in the case of an estate or trust, the deduction
allowed for such year under section 642(b).''.
(J) Net earnings from self-employment.--Section 1402(a) is
amended by striking paragraph (7).
(K) Payroll withholding.--
(i) In general.--Paragraph (1) of section 3402(f) is
amended by striking subparagraph (A) and all that follows and
inserting the following:
``(A) the family allowance amount; and
``(B) any additional amounts to which the employee elects
to take into account under subsection (m), but only if the
employee's spouse does not have in effect a withholding
allowance certificate claiming such allowance.''.
(ii) Family allowance exemption amount.--Subsection (f) of
section 3402 is amended--
(I) by redesignating paragraphs (2), (3), (4), (5), (6),
and (7) as paragraphs (3), (4), (5), (6), (7), and (8),
respectively,
(II) by striking ``paragraph (2)(C)'' in paragraph
(3)(B)(iii) and inserting ``paragraph (3)(C)'', and
(III) by inserting after paragraph (1) the following new
paragraph:
``(2) Family allowance exemption amount.--For purposes of
this section--
``(A) In general.--Except as provided in subparagraphs (B)
and (C), the term `family allowance exemption amount' means
the family allowance amount with respect to the taxpayer
under section 63(b) for the taxable year in which the payroll
period begins, prorated to the payroll period.
``(B) Married employees.--If the employee is married filing
jointly and the employee's spouse is an employee receiving
wages, the employee and the employee's spouse may divide the
family allowance amount determined under section 63(b) in the
proportion of their choice for purposes of this paragraph,
but the sum of the family allowance exemption amounts claimed
by the employee and the employee's spouse shall not exceed
such family allowance amount.
``(C) Employees with more than 1 employer.--In the case of
an employee that has withholding exemption certificates in
effect with respect to more than 1 employer, the employee may
divide the family allowance amount (or the employee's share
of such amount after the application of subparagraph (B), if
applicable) determined under section 63(b) among employers in
the proportion of the employee's choice for purposes of this
paragraph, but the sum of the family allowance exemption
amounts claimed by the employee with respect to all employers
shall not exceed such family allowance amount (or the
employee's share of such amount after the application of
subparagraph (B), if applicable).''.
(iii) Conforming amendments.--
(I) Paragraph (7) of section 3402(f), as redesignated by
subparagraph (B)(i) of this paragraph, is amended by striking
``shall be entitled to only one withholding exemption'' and
inserting ``shall be treated as single or married filing
separately for purposes of determining the family allowance
exemption amount''.
(II) Paragraph (8) of section 3402(f), as redesignated by
subparagraph (B)(i) of this paragraph, is amended by
inserting ``, except as provided in paragraph (2)(C)'' after
``with respect to one employer''.
(III) Paragraph (3) of section 3402(m) is amended by
striking ``deductions (including the additional standard
deduction under section 63(c)(3) for the aged and blind)''
and inserting ``deductions''.
(IV) Paragraph (2) of section 3402(r) is amended striking
``the sum of'' and all that follows and inserting ``the
family allowance amount determined under section 63(b) for a
taxpayer who is single or married filing separately.''.
(V) Section 6040(4) is amended by striking ``section
3402(f)(2), (3), (4), and (5)'' and inserting ``paragraphs
(3), (4), (5), and (6) of section 3402(f)''.
(L) Joint returns.--Section 6013(b)(3)(A) is amended by
striking ``has the meaning given to such term'' and all that
follows and inserting ``means the family allowance amount
applicable to a taxpayer who is single or married filing
separately under section 63(b).''.
(M) Amounts subject to levy.--
(i) Section 6334(d)(2)(A) is amended to read as follows:
``(A) 50 percent of the family allowance amount determined
under section 63(b) with respect to the taxpayer for the
taxable year in which such levy occurs, divided by''.
(ii) Section 6334(d) is amended by striking paragraph (4).
(c) Other Conforming Amendments.--
(1) Section 1(f)(7) is amended--
(A) by striking ``section 63(c)(4), section 68(b)(2) or
section 151(d)(4)'' in subparagraph (A) and inserting
``subsection (g)(4)(B), section 63(b)(3), section 68(b)(2),
or section 7706(d)(6)'', and
(B) by striking ``sections 63(c)(4) and section
151(d)(4)(A)'' in subparagraph (B) and inserting ``sections
63(b)(3) and 7706(d)(6)''.
(2) Section 1(g)(4) is amended--
(A) by striking subparagraph (A)(ii)(I) and inserting the
following:
``(I) $500, plus'', and
(B) by redesignating subparagraphs (B) and (C) as
subparagraphs (C) and (D), respectively, and inserting after
subparagraph (A) the following new subparagraph:
``(B) Adjustment for inflation.--In the case of any taxable
year beginning in a calendar year after 1988, the $500 amount
in subparagraph (A)(ii)(I) shall be increased by an amount
equal to--
``(i) such dollar amount, multiplied by
``(ii) the cost-of-living adjustment determined under
subsection (f)(3) for the calendar year in which the taxable
year begins, by substituting `1987' for `2016' in
subparagraph (A)(ii) thereof.''.
(3) Section 1(g)(5)(A) is amended by striking ``section
152(e)'' and inserting ``section 7706(e)''.
(4) Section 2(a)(1)(B) is amended--
(A) by striking ``section 152'' and inserting ``section
7706'', and
(B) by striking ``with respect to whom the taxpayer is
entitled to a deduction for the taxable year under section
151'' and inserting ``whose TIN is included on the taxpayer's
return of tax for the taxable year''.
(5) Section 2(b)(1)(A)(i) is amended--
(A) in the matter preceding subclause (I)--
(i) by striking ``section 152(c)'' and inserting ``section
7706(c)'', and
(ii) by striking ``section 152(e)'' and inserting ``section
7706(e)'', and
(B) in subclause (II), by striking ``section 152(b)(2) or
152(b)(3)'' and inserting ``section 7706(b)(2) or
7706(b)(3)''.
(6) Section 2(b)(1)(A)(ii) is amended by striking ``if the
taxpayer is entitled to a deduction for the taxable year for
such person under section 151'' and inserting ``if the
taxpayer included such person's TIN on the return of tax for
the taxable year''.
(7) Section 2(b)(1)(B) is amended by striking ``if the
taxpayer is entitled to a deduction for the taxable year for
such father or mother under section 151'' and inserting ``if
such father or mother is a dependent of the taxpayer and the
taxpayer included such father or mother's TIN on the return
of tax for the taxable year''.
(8) Section 2(b)(3)(B) is amended--
(A) by striking ``section 152(d)(2)'' in clause (i) and
inserting ``section 7706(d)(2)'', and
(B) by striking ``section 152(d)'' in clause (ii) and
inserting ``section 7706(d)''.
(9) Section 36B(b)(2)(A) is amended by striking ``section
152'' and inserting ``section 7706''.
(10) Section 36B(b)(3)(B) is amended by striking ``unless a
deduction is allowed under section 151 for the taxable year
with respect
[[Page S7550]]
to a dependent'' in the flush matter at the end and inserting
``unless the taxpayer has a dependent for the taxable year
(and the taxpayer included such dependent's TIN on the return
of tax for the taxable year)''.
(11) Section 36B(c)(1)(D) is amended by striking ``with
respect to whom a deduction under section 151 is allowable to
another taxpayer'' and inserting ``who is a dependent of
another taxpayer''.
(12) Section 36B(d)(1) is amended by striking ``equal to
the number of individuals for whom the taxpayer is allowed a
deduction under section 151 (relating to allowance of
deduction for personal exemptions) for the taxable year'' and
inserting ``the sum of 1 (2 in the case of a joint return)
plus the number of individuals who are dependents of the
taxpayer for the taxable year''.
(13) Section 36B(e)(1) is amended by striking ``1 or more
individuals for whom a taxpayer is allowed a deduction under
section 151 (relating to allowance of deduction for personal
exemptions) for the taxable year (including the taxpayer or
his spouse)'' and inserting ``1 or more of the taxpayer, the
taxpayer's spouse, or any dependent of the taxpayer''.
(14) Section 42(i)(3)(D)(ii)(I) is amended by striking
``section 152'' and inserting ``section 7706''.
(15) Section 45R(e)(1)(A)(iv) is amended--
(A) by striking ``section 152(d)(2)'' and inserting
``section 7706(d)(2)'', and
(B) by striking ``section 152(d)(2)(H)'' and inserting
``section 7706(d)(2)(H)''.
(16) Section 51(i)(1) is amended--
(A) by striking ``section 152(d)(2)'' in subparagraphs (A)
and (B) and inserting ``section 7706(d)(2)'', and
(B) by striking ``section 152(d)(2)(H)'' in subparagraph
(C) and inserting ``section 7706(d)(2)(H)''.
(17) Section 72(t)(2)(D)(i)(III) is amended by striking
``section 152'' and inserting ``section 7706''.
(18) Section 72(t)(7)(A)(iii) is amended by striking
``section 152(f)(1)'' and inserting ``section 7706(f)(1)''.
(19) Section 105(b) is amended--
(A) by striking ``as defined in section 152'' and inserting
``as defined in section 7706'',
(B) by striking ``section 152(f)(1)'' and inserting
``section 7706(f)(1)'' and
(C) by striking ``section 152(e)'' and inserting ``section
7706(e)''.
(20) Section 105(c)(1) is amended by striking ``section
152'' and inserting ``section 7706''.
(21) Section 125(e)(1)(D) is amended by striking ``section
152'' and inserting ``section 7706''.
(22) Section 129(c)(1) is amended to read as follows:
``(1) who is a dependent of such employee or of such
employee's spouse, or''.
(23) Section 129(c)(2) is amended by striking ``section
152(f)(1)'' and inserting ``section 7706(f)(1)''.
(24) Section 132(h)(2)(B) is amended--
(A) by striking ``section 152(f)(1)'' and inserting
``section 7706(f)(1)'', and
(B) by striking ``section 152(e)'' and inserting ``section
7706(e)''.
(25) Section 139D(c)(5) is amended by striking ``section
152'' and inserting ``section 7706''.
(26) Section 139E(c)(2) is amended by striking ``section
152'' and inserting ``section 7706''.
(27) Section 162(l)(1)(D) is amended by striking ``section
152(f)(1)'' and inserting ``section 7706(f)(1)''.
(28) Section 170(g)(1) is amended by striking ``section
152'' and inserting ``section 7706''.
(29) Section 170(g)(3) is amended by striking ``section
152(d)(2)'' and inserting ``section 7706(d)(2)''.
(30) Section 213(a) is amended by striking ``section 152''
and inserting ``section 7706''.
(31) Section 213(d)(5) is amended by striking ``section
152(e)'' and inserting ``section 7706(e)''.
(32) Section 213(d)(11) is amended by striking ``section
152(d)(2)'' in the matter following subparagraph (B) and
inserting ``section 7706(d)(2)''.
(33) Section 220(b)(6) is amended by striking ``with
respect to whom a deduction under section 151 is allowable
to'' and inserting ``who is a dependent of''.
(34) Section 220(d)(2)(A) is amended by striking ``section
152'' and inserting ``section 7706''.
(35) Section 223(b)(6) is amended by striking ``with
respect to whom a deduction under section 151 is allowable
to'' and inserting ``who is a dependent of''.
(36) Section 223(d)(2)(A) is amended by striking ``section
152'' and inserting ``section 7706''.
(37) Section 401(h) is amended by striking ``section
152(f)(1)'' in the last sentence and inserting ``section
7706(f)(1)''.
(38) Section 402(l)(4)(D) is amended by striking ``section
152'' and inserting ``section 7706''.
(39) Section 409A(a)(2)(B)(ii)(I) is amended by striking
``section 152(a)'' and inserting ``section 7706(a)''.
(40) Section 501(c)(9) is amended by striking ``section
152(f)(1)'' and inserting ``section 7706(f)(1)''.
(41) Section 529(e)(2)(B) is amended by striking ``section
152(d)(2)'' and inserting ``section 7706(d)(2)''.
(42) Section 529A(e)(4) is amended--
(A) by striking ``section 152(d)(2)(B)'' and inserting
``section 7706(d)(2)(B)'', and
(B) by striking ``section 152(f)(1)(B)'' and inserting
``section 7706(f)(1)(B)''.
(43) Section 643(a)(2) is amended--
(A) by striking ``(relating to deduction for personal
exemptions)'' and inserting ``(relating to basic
deduction)'', and
(B) by striking ``Deduction for personal exemption'' in the
heading thereof and inserting ``Basic deduction''.
(44) Section 1361(c)(1)(C) is amended by striking ``section
152(f)(1)(C)'' and inserting ``section 7706(f)(1)(C)''.
(45) Section 2032A(c)(7)(D) is amended by striking
``section 152(f)(2)'' and inserting ``section 7706(f)(2)''.
(46) Section 5000A(b)(3)(A) is amended by striking
``section 152'' and inserting ``section 7706''.
(47) Section 5000A(c)(4)(A) is amended by striking ``the
number of individuals for whom the taxpayer is allowed a
deduction under section 151 (relating to allowance of
deduction for personal exemptions) for the taxable year'' and
inserting ``the sum of 1 (2 in the case of a joint return)
plus the number of the taxpayer's dependents for the taxable
year''.
(48) Section 6103(l)(21)(A)(iii) is amended by striking
``for whom a deduction is allowed under section 151'' and
inserting ``who is taken into account as a dependent under
section 7706 for purposes of any provision of this title''.
(49) Section 6213(g)(2)(H) is amended by striking ``section
21 (relating to expenses for household and dependent care
services necessary for gainful employment) or section 151
(relating to allowance of deductions for personal
exemptions)'' and inserting ``subsection (a)(1)(B),
(b)(1)(A)(ii), or (b)(1)(B) of section 2 or section
36B(b)(3)(B)''.
(50) Section 7702B(f)(2)(C)(iii) is amended by striking
``section 152(d)(2)'' and inserting ``section 7706(d)(2)''.
(51) Section 7703(a) is amended by striking ``part V of
subchapter B of chapter 1 and''.
(52) Section 7703(b)(1) is amended by striking ``section
152(f)(1))'' and all that follows and inserting ``section
7706(f)(1)) who is a dependent of such individual for the
taxable year (or would be but for section 7706(e)),''.
(53) Section 7706(a), as redesignated by this section, is
amended by striking ``this subtitle'' and inserting
``subtitle A''.
(54) Section 7706(e)(3), as redesignated by this section,
is amended by inserting ``(as in effect before its repeal)''
after ``section 151''.
(55) The table of parts for subchapter B of chapter 1 is
amended by striking the item relating to part V.
(56) The table of sections for chapter 79 is amended by
adding at the end the following new item:
``Sec. 7706. Dependent defined.''.
(d) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2021.
SEC. 203. REPEAL OF LIMITATIONS RELATING TO ITEMIZED
DEDUCTIONS.
(a) In General.--Sections 67 and 68 are repealed.
(b) Conforming Amendments.--
(1) Section 162(o) is amended by striking paragraph (2) and
redesignating paragraph (3) as paragraph (2).
(2) Section 164(b)(5)(H)(ii) is amended--
(A) by striking the comma at the end of subclause (I) and
inserting ``, and'',
(B) by striking ``, and'' at the end of subclause (II) and
inserting a period, and
(C) by striking subclause (III).
(3) Section 302(b)(5) is amended by inserting ``, as in
effect on December 31, 2021'' after ``67(c)(2)(B)''.
(4) Section 562(c) is amended by inserting ``, as in effect
on December 31, 2021'' after ``67(c)(2)(B)''.
(5) Section 642(b)(2)(C)(i)(II) is amended by inserting ``,
and as in effect on December 31, 2021'' after ``642(b)''.
(6) Section 6654(d)(1)(C)(iii) is amended by inserting ``,
as in effect on December 31, 2021'' before the period.
(c) Effective Date.--The repeal and the amendments made by
this section shall apply to taxable years beginning after
December 31, 2021.
SEC. 204. RESTORATION OF CERTAIN DEDUCTIONS.
(a) Deduction for Qualified Residence Interest.--Section
163(h)(3) is amended by striking subparagraph (F).
(b) Deduction for State and Local Taxes.--Section 164(b) is
amended by striking paragraph (6).
(c) Deduction for Personal Casualty Losses.--Section 165(h)
is amended by striking paragraph (5).
(d) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2021.
SEC. 205. TERMINATION OF SEPARATE TREATMENT OF CAPITAL GAINS.
Subsection (h) of section 1 is amended by adding at the end
the following new paragraph:
``(12) Termination.--This subsection shall not apply to any
taxable year beginning after December 31, 2021.''.
SEC. 206. REPEALS.
(a) In General.--The following provisions of the Internal
Revenue Code of 1986 are repealed:
(1) Subpart A of part IV of subchapter A of chapter 1
(relating to nonrefundable personal credits).
(2) Subpart B of part IV of subchapter A of chapter 1
(relating to other credits), other than section 27 (relating
to taxes of foreign countries and possessions of the United
States; possession tax credit).
[[Page S7551]]
(3) Sections 34, 35, and 36.
(4) Part VI of subchapter A of chapter 1 (relating to
alternative minimum tax).
(5) Section 199A (relating to deduction for qualified
business income).
(6) Section 217 (relating to moving expenses).
(7) Section 221 (relating to interest on education loans).
(8) Section 222 (relating to qualified tuition and related
expenses).
(9) Chapter 2A (relating to unearned income medicare
contribution).
(b) Effective Date.--The repeals made by subsection (a)
shall take effect for taxable years beginning after December
31, 2021.
SEC. 207. ESTABLISHMENT OF PROGRESSIVE TAX REBATE.
(a) In General.--Section 32 is amended to read as follows:
``SEC. 32. PROGRESSIVE TAX REBATE.
``(a) Allowance of Credit.--In the case of an eligible
taxpayer, there shall be allowed as a credit against the tax
imposed by this subtitle for the taxable year an amount equal
to the sum of--
``(1) the earned income amount (as determined under
subsection (b)),
``(2) the child benefit amount (as determined under
subsection (c)), plus
``(3) the additional child benefit amount (as determined
under subsection (d)).
``(b) Earned Income Amount.--
``(1) Single workers.--In the case of an eligible taxpayer
(other than a head of a household as defined in section 2(b))
who is not filing a joint return for the taxable year under
section 6013, the earned income amount shall be equal to--
``(A) in the case of a taxpayer whose earned income for the
taxable year does not exceed $6,100, 25.1 percent of such
earned income,
``(B) in the case of a taxpayer whose earned income for the
taxable year exceeds $6,100 but does not exceed $9,000,
$1,530 plus 17.1 percent of such earned income in excess of
$6,100,
``(C) in the case of a taxpayer whose earned income (or, if
greater, adjusted gross income) for the taxable year exceeds
$9,000, but does not exceed $49,494, $2,025 minus 5 percent
of such earned income or adjusted gross income in excess of
$9,000, or
``(D) in the case of a taxpayer whose earned income (or, if
greater, adjusted gross income) for the taxable year exceeds
$49,494, $0.
``(2) Head of household.--In the case of an eligible
taxpayer who is a head of a household (as defined in section
2(b)), the earned income amount shall be equal to--
``(A) in the case of a taxpayer whose earned income for the
taxable year does not exceed $9,150, 25.1 percent of such
earned income,
``(B) in the case of a taxpayer whose earned income for the
taxable year exceeds $9,150 but does not exceed $13,500,
$2,294 plus 17.1 percent of such earned income in excess of
$9,150,
``(C) in the case of a taxpayer whose earned income (or, if
greater, adjusted gross income) for the taxable year exceeds
$13,500, but does not exceed $74,241, $3,037 minus 5 percent
of such earned income or adjusted gross income in excess of
$13,500, or
``(D) in the case of a taxpayer whose earned income (or, if
greater, adjusted gross income) for the taxable year exceeds
$74,241, $0.
``(3) Married filing jointly.--In the case of an eligible
taxpayer filing a joint return under section 6013, the earned
income amount shall be determined pursuant to paragraph (1),
except that the dollar amounts in effect under such paragraph
shall be multiplied by 2.
``(c) Child Benefit Amount.--
``(1) In general.--In the case of an eligible taxpayer with
a qualifying child, the child benefit amount shall be equal
to 15 percent of the earned income of such taxpayer for the
taxable year.
``(2) Limitations.--
``(A) Limitation based on number of children.--The child
benefit amount determined under paragraph (1) shall not
exceed an amount equal to the product of--
``(i) the number of qualifying children of the taxpayer,
multiplied by
``(ii) $1,590.
``(B) Reduction based on earnings or adjusted gross
income.--The child benefit amount determined under this
subsection (as determined after application of subparagraph
(A)) shall be reduced (but not below zero) by an amount equal
to 5 percent of the earned income (or, if greater, the
adjusted gross income) of the taxpayer for the taxable year
in excess of $75,000 ($110,000 in the case of a joint
return).
``(d) Additional Child Benefit Amount.--
``(1) In general.--In the case of an eligible taxpayer with
a qualifying child, the additional child benefit amount shall
be equal to--
``(A) in the case of a taxpayer whose earned income for the
taxable year does not exceed $20,000, the applicable
percentage of such earned income,
``(B) in the case of a taxpayer whose earned income exceeds
$20,000 but does not exceed $25,000, the applicable
percentage of $20,000,
``(C) in the case of a taxpayer whose earned income (or, if
greater, adjusted gross income) exceeds $25,000 but does not
exceed the applicable amount, an amount equal to--
``(i) the applicable percentage of $20,000, minus
``(ii) 15 percent of such earned income or adjusted gross
income in excess of $25,000, or
``(D) in the case of a taxpayer whose earned income (or, if
greater, adjusted gross income) exceeds the applicable
amount, $0.
``(2) Applicable percentage.--For purposes of paragraph
(1), the applicable percentage is--
``(A) in the case of a taxpayer with 1 qualifying child, 11
percent,
``(B) in the case of a taxpayer with 2 qualifying children,
17 percent, and
``(C) in the case of a taxpayer with 3 or more qualifying
children, 19 percent.
``(3) Applicable amount.--For purposes of paragraph (1),
the applicable amount is--
``(A) in the case of a taxpayer with 1 qualifying child,
$39,667,
``(B) in the case of a taxpayer with 2 qualifying children,
$47,667, and
``(C) in the case of a taxpayer with 3 or more qualifying
children, $50,333.
``(e) Eligible Taxpayer.--
``(1) In general.--The term `eligible taxpayer' means an
individual--
``(A) whose principal place of abode is in the United
States for more than one-half of such taxable year, and
``(B) is not a dependent (as defined under section 152) to
another taxpayer for any taxable year beginning in the same
calendar year as such taxable year.
``(2) Qualifying child ineligible.--If an individual is the
qualifying child of a taxpayer for any taxable year of such
taxpayer beginning in a calendar year, such individual shall
not be treated as an eligible taxpayer for any taxable year
of such individual beginning in such calendar year.
``(3) Exception for taxpayer claiming benefits under
section 911.--The term `eligible taxpayer' does not include
any taxpayer who claims the benefits of section 911 for the
taxable year.
``(4) Limitation on eligibility of nonresident aliens.--The
term `eligible taxpayer' shall not include any individual who
is a nonresident alien individual for any portion of the
taxable year unless such individual is treated for such
taxable year as a resident of the United States for purposes
of this chapter by reason of an election under subsection (g)
or (h) of section 6013.
``(5) Identification number requirement.--No credit shall
be allowed under this section to an eligible taxpayer who
does not include on the return of tax for the taxable year--
``(A) such individual's taxpayer identification number, and
``(B) if the individual is married (within the meaning of
section 7703), the taxpayer identification number of such
individual's spouse.
``(6) Taxpayers who do not include tin, etc., of any
qualifying child.--No credit shall be allowed under this
section to any eligible taxpayer who has one or more
qualifying children if no qualifying child of such taxpayer
is taken into account under subsection (c) or (d) by reason
of subsection (f)(4).
``(7) Treatment of military personnel stationed outside of
the united states.--For purposes of paragraph (1)(A) and
subsection (f)(3), the principal place of abode of a member
of the Armed Forces of the United States shall be treated as
in the United States during any period during which such
member is stationed outside the United States while serving
on extended active duty with the Armed Forces of the United
States. For purposes of the preceding sentence, the term
`extended active duty' means any period of active duty
pursuant to a call or order to such duty for a period in
excess of 90 days or for an indefinite period.
``(8) Joint return.--
``(A) Married individuals.--In the case of an individual
who is married (within the meaning of section 7703), this
section shall apply only if a joint return is filed for the
taxable year under section 6013.
``(B) Other.--In the case of taxpayer filing a joint return
under section 6013, such taxpayer shall not be treated as an
eligible taxpayer for purposes of this section unless either
the taxpayer or the taxpayer's spouse satisfies each of the
requirements under this subsection.
``(f) Qualifying Child.--
``(1) In general.--The term `qualifying child' means a
qualifying child of the taxpayer (as defined in section
152(c), determined without regard to paragraph (1)(D) thereof
and section 152(e)).
``(2) Married individual.--The term `qualifying child'
shall not include an individual who is married as of the
close of the eligible taxpayer's taxable year unless the
individual qualifies as a dependent (as defined under section
152) of the taxpayer for such taxable year.
``(3) Place of abode.--For purposes of paragraph (1), the
requirements of section 152(c)(1)(B) shall be met only if the
principal place of abode is in the United States.
``(4) Identification requirements.--
``(A) In general.--A qualifying child shall not be taken
into account under subsection (c) or (d) unless the taxpayer
includes the name, age, and TIN of the qualifying child on
the return of tax for the taxable year.
``(B) Other methods.--The Secretary may prescribe other
methods for providing the information described in
subparagraph (A).
``(g) Earned Income.--
``(1) In general.--The term `earned income' means--
``(A) wages, salaries, tips, and other employee
compensation, but only if such amounts are includible in
gross income for the taxable year, plus
``(B) the amount of the taxpayer's net earnings from self-
employment for the taxable year (within the meaning of
section
[[Page S7552]]
1402(a)), but such net earnings shall be determined with
regard to the deduction allowed to the taxpayer by section
164(f).
``(2) Special rules.--For purposes of paragraph (1)--
``(A) no amount received as a pension or annuity shall be
taken into account,
``(B) no amount to which section 871(a) applies (relating
to income of nonresident alien individuals not connected with
United States business) shall be taken into account,
``(C) no amount received for services provided by an
individual while the individual is an inmate at a penal
institution shall be taken into account,
``(D) no amount described in paragraph (1) received for
service performed in work activities as defined in paragraph
(4) or (7) of section 407(d) of the Social Security Act to
which the taxpayer is assigned under any State program under
part A of title IV of such Act shall be taken into account,
but only to the extent such amount is subsidized under such
State program, and
``(E) a taxpayer may elect to treat amounts excluded from
gross income by reason of section 112 as earned income.
``(h) Taxable Year Must Be Full Taxable Year.--Except in
the case of a taxable year closed by reason of the death of
the eligible taxpayer, no credit shall be allowable under
this section in the case of a taxable year covering a period
of less than 12 months.
``(i) Coordination With Certain Means-Tested Programs.--For
purposes of--
``(1) the United States Housing Act of 1937,
``(2) title V of the Housing Act of 1949,
``(3) section 101 of the Housing and Urban Development Act
of 1965,
``(4) sections 221(d)(3), 235, and 236 of the National
Housing Act, and
``(5) the Food and Nutrition Act of 2008,
any refund made to a taxpayer by reason of this section shall
not be treated as income (and shall not be taken into account
in determining resources for the month of its receipt and the
following month).
``(j) Amount of Credit To Be Determined Under Tables.--The
amount of the credit allowed by this section shall be
determined under tables prescribed by the Secretary.
``(k) Denial of Credit for Individuals Having Excessive
Investment Income.--
``(1) In general.--No credit shall be allowed under
subsection (a) for the taxable year if the aggregate amount
of disqualified income of the taxpayer for the taxable year
exceeds $5,000.
``(2) Disqualified income.--For purposes of paragraph (1),
the term `disqualified income' means--
``(A) interest or dividends to the extent includible in
income for the taxable year,
``(B) interest received or accrued during the taxable year
which is exempt from tax imposed by this chapter,
``(C) the excess (if any) of--
``(i) gross income from rents or royalties not derived in
the ordinary course of a trade or business, over
``(ii) the sum of--
``(I) the deductions (other than interest) which are
clearly and directly allocable to such gross income, plus
``(II) interest deductions properly allocable to such gross
income,
``(D) the capital gain net income (as defined in section
1222) of the taxpayer for such taxable year, and
``(E) the excess (if any) of--
``(i) the aggregate income from all passive activities for
the taxable year (determined without regard to any amount
included in earned income under subsection (f) or described
in a preceding subparagraph), over
``(ii) the aggregate losses from all passive activities for
the taxable year (as so determined).
``(3) Passive activity.--For purposes of paragraph (2)(E),
the term `passive activity' has the meaning given such term
by section 469.
``(l) Inflation Adjustments.--
``(1) In general.--In the case of any taxable year
beginning after 2022, each of the dollar amounts in
subsections (b), (c), (d), and (j)(1) shall each be increased
by an amount equal to--
``(A) such dollar amount, multiplied by
``(B) the cost-of-living adjustment determined under
section 1(f)(3) for the calendar year in which the taxable
year begins, determined by substituting `2021' for `2016' in
subparagraph (A)(ii) thereof.
``(2) Rounding.--If any dollar amount in subsections (b),
(c), (d), and (j)(1), after being increased under paragraph
(1), is not a multiple of $100, such dollar amount shall be
rounded to the nearest multiple of $100.
``(m) Restrictions on Taxpayers Who Improperly Claimed
Credit in Prior Year.--
``(1) Taxpayers making prior fraudulent or reckless
claims.--
``(A) In general.--No credit shall be allowed under this
section for any taxable year in the disallowance period.
``(B) Disallowance period.--For purposes of subparagraph
(A), the disallowance period is--
``(i) the period of 10 taxable years after the most recent
taxable year for which there was a final determination that
the taxpayer's claim of credit under this section was due to
fraud, and
``(ii) the period of 2 taxable years after the most recent
taxable year for which there was a final determination that
the taxpayer's claim of credit under this section was due to
reckless or intentional disregard of rules and regulations
(but not due to fraud).
``(2) Taxpayers making improper prior claims.--In the case
of a taxpayer who is denied credit under this section for any
taxable year as a result of the deficiency procedures under
subchapter B of chapter 63, no credit shall be allowed under
this section for any subsequent taxable year unless the
taxpayer provides such information as the Secretary may
require to demonstrate eligibility for such credit.''.
(b) Conforming Amendments.--
(1) Section 86(f)(2) is amended by striking ``section
32(c)(2)'' and inserting ``section 32(g)''.
(2) Section 129(e)(2) is amended by striking ``section
32(c)(2)'' and inserting ``section 32(g)''.
(3) Section 6213(g)(2) is amended--
(A) in subparagraph (G), by striking ``section
32(c)(2)(A)'' and inserting ``section 32(g)(1)'', and
(B) in subparagraph (K), by striking ``section 32(k)(2)''
and inserting ``section 32(m)(2)''.
(4) Paragraph (2) of section 1324(b) of title 31, United
States Code, is amended by inserting ``32,'' after ``25A,''.
(5) The table of sections for subpart C of part IV of
subchapter A of chapter 1 of subtitle A is amended by
striking the item relating to section 32 and inserting the
following:
``Sec. 32. Progressive tax rebate.''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2021.
SEC. 208. TECHNICAL AND CONFORMING AMENDMENTS.
The Secretary of the Treasury or the Secretary's delegate
shall, not later than 90 days after the date of the enactment
of this Act, submit to the Committee on Ways and Means of the
House of Representatives and the Committee on Finance of the
Senate a draft of any technical and conforming changes in the
Internal Revenue Code of 1986 which are necessary to reflect
throughout such Code the purposes of the provisions of, and
amendments made by, this title.
Subtitle B--Corporate Tax Reforms
SEC. 211. CORPORATE INCOME TAX RATE REDUCTION.
(a) In General.--Subsection (b) of section 11 is amended to
read as follows:
``(b) Amount of Tax.--The amount of the tax imposed by
subsection (a) shall be an amount equal to 17 percent of the
taxable income.''.
(b) Conforming Amendment.--Section 1551 is amended--
(1) by striking ``benefits of the graduated corporate rates
and'' in the heading,
(2) by striking ``the benefits of the rates contained in
section 11(b) which are lower than the highest rate specified
in such section, or'' in subsection (a), and
(3) by striking ``such benefits or credit'' in subsection
(a) and inserting ``such credit''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2021.
TITLE III--REFUND OF EXCESS CONSUMPTION TAX REVENUE
SEC. 301. REFUNDS OF EXCESS CONSUMPTION TAX REVENUE.
(a) In General.--Subchapter B of chapter 65 is amended by
adding at the end the following new section:
``SEC. 6433. REFUNDS OF EXCESS CONSUMPTION TAX REVENUE.
``(a) In General.--In the case of any qualifying excess
consumption tax revenue year, the Secretary shall pay to each
eligible filer an amount equal to the consumption tax refund
amount.
``(b) Qualifying Excess Consumption Tax Revenue Year.--For
purposes of this section--
``(1) In general.--The term `qualifying excess consumption
tax revenue year' means any calendar year for which the net
consumption tax revenues exceed 10 percent of gross domestic
product for such year.
``(2) Net consumption tax revenues.--The net consumption
tax revenues for any calendar year shall be the excess of--
``(A) the tax imposed under section 3901 with respect to
taxable supplies the tax point for which is during such
calendar year, over
``(B) the credits allowed under section 3916 for such
calendar year.
``(3) Gross domestic product.--The gross domestic product
for any calendar year shall be the last estimate of the gross
domestic product for such calendar year by the Department of
Commerce which is published before the date that is 3 months
after the close of such calendar year.
``(c) Eligible Filer.--For purposes of this section--
``(1) Definition.--
``(A) In general.--The term `eligible filer' means, with
respect to any qualifying excess consumption tax revenue
year, any individual (other than an individual described in
paragraph (2)) who filed a return of income tax for the
individual's qualifying rebate taxable year.
``(B) Exclusion.--The term `eligible filer' shall not
include--
``(i) any nonresident alien individual,
``(ii) any individual who is a dependent (as defined in
section 152) of another taxpayer for the individual's
qualifying rebate taxable year, or
``(iii) an estate or trust.
``(2) Qualifying rebate taxable year.--The term `qualifying
rebate taxable year'
[[Page S7553]]
means, with respect to any individual in connection with a
qualifying excess consumption tax revenue year, the taxable
year of such individual which contains 6 or more months of
such qualifying excess consumption tax revenue year.
``(3) Identification requirement.--
``(A) In general.--An individual shall not be treated as an
eligible filer for any year unless such individual includes
on the return of tax for such year--
``(i) such individual's valid identification number,
``(ii) in the case of a joint return, the valid
identification number of such individual's spouse, and
``(iii) the valid identification number of any qualifying
child (as defined in section 32(f)) claimed on such return.
``(B) Valid identification number.--For purposes of
subparagraph (A), the term `valid identification number'
means a social security number issued to an individual by the
Social Security Administration. Such term shall not include a
TIN issued by the Internal Revenue Service.
``(C) Special rule for members of the armed forces.--
Subparagraph (A) shall not apply to a joint return where at
least 1 spouse was a member of the Armed Forces of the United
States at any time during the taxable year.
``(d) Consumption Tax Refund Amount.--
``(1) In general.--The consumption tax refund amount for
any eligible filer for any qualifying excess consumption tax
year shall be the product of--
``(A) the applicable amount, times
``(B) the applicable shares of the eligible filer.
``(2) Applicable amount.--The applicable amount for any
qualifying excess revenue consumption tax year is an amount
equal to--
``(A) the excess described in subsection (b)(1), divided by
``(B) the total number of applicable shares of all eligible
filers for such year.
``(3) Applicable share.--The number of applicable shares
for any eligible filer shall be the sum of--
``(A) 1 (2 in the case of a joint return), plus
``(B) \1/2\ of the number of qualifying children (as
defined in section 32(f)) claimed on the eligible filer's
return for the filer's qualifying rebate taxable year.
``(e) Time for Payment.--Payments under subsection (a)
shall be made as soon as practical after the Secretary has
determined the consumption tax refund amount.''.
(b) Conforming Amendments.--
(1) Section 1324(b)(2) of title 31, United States Code, is
amended by striking ``or 6431'' and inserting ``6431, or
6433''.
(2) The table of sections for subchapter B of chapter 65 is
amended by adding at the end the following new item:
``Sec. 6433. Refunds of excess consumption tax revenue.''.
(c) Effective Date.--The amendments made by this section
shall apply to calendar years beginning after the date of the
enactment of this Act.
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By Mr. WYDEN (for himself, Mr. Bennet, Mr. Brown, Mr. Casey, Ms.
Cortez Masto, Mr. Durbin, Ms. Klobuchar, and Mrs. Murray):
S. 5035. A bill to amend the Internal Revenue Code of 1986 to provide
matching payments for retirement savings contributions by certain
individuals; to the Committee on Finance.
Mr. WYDEN. Mr. President, today I have introduced the Encouraging
Americans to Save Act (EASA). This legislation makes common sense
reforms to the saver's tax credit by making the credit refundable and
restructuring it as a government matching contribution that is directly
deposited into a worker's retirement savings account.
This bill would offer matching contributions for the first time to
millions of middle and lower income individuals not covered by an
employer-sponsored retirement plan, including those who save through an
IRA under a State or local government savings program-such as workers
in my home State of Oregon under the OregonSaves program. The
government match is also available to middle and lower income savers
who participate in an employer-sponsored plan.
The government match provided by the bill would both encourage saving
and help middle and low income earners build assets by providing an
immediate, meaningful return on their personal contributions. The
legislation would also establish a coronavirus bonus recovery credit
that would provide an additional government match of up to $5,000 to
workers on their retirement saving for a five year period beginning in
2022. I urge my colleagues to support this legislation.
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By Mr. GRAHAM:
S. 5036. A bill to amend the Overtime Pay for Protective Services Act
of 2016 to extend the Secret Service overtime pay exception through
2023, and for other purposes; considered and passed.
S. 5036
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 ``Secret Service Overtime Pay
Extension Act''.
SEC. 2. EXTENSION OF OVERTIME PAY EXCEPTION THROUGH 2023 FOR
PROTECTIVE SERVICES.
(a) In General.--Section 2 of the Overtime Pay for
Protective Services Act of 2016 (5 U.S.C. 5547 note) is
amended--
(1) in the section heading, by striking ``2020'' and
inserting ``2023'';
(2) in subsection (a), by striking ``during 2016, 2017,
2018, 2019, or 2020'' and inserting ``during any of calendar
years 2016 through 2023''; and
(3) in subsection (b)(1)--
(A) by inserting ``for a given calendar year'' after ``for
premium pay''; and
(B) by striking ``during 2016, 2017, 2018, 2019, and 2020''
and inserting ``during each of calendar years 2016 through
2023''.
(b) Reports.--
(1) Definition.--In this subsection, the term ``appropriate
committees of Congress'' means the Committee on
Appropriations, the Committee on Homeland Security and
Governmental Affairs, and the Committee on the Judiciary of
the Senate and the Committee on Appropriations, the Committee
on Oversight and Reform, and the Committee on the Judiciary
of the House of Representatives.
(2) Report on extensions.--Not later than January 30 of
each of calendar years 2021, 2022, and 2023, the Director of
the United States Secret Service shall submit to the
appropriate committees of Congress a report on the effects of
the amendments made by subsection (a) and the amendments made
by section 2(a) of the Secret Service Overtime Pay Extension
Act (Public Law 115-383; 132 Stat. 5121), which shall
include, with respect to the previous calendar year, the
information described under paragraphs (1) through (7) of
section 2(c) of the Secret Service Recruitment and Retention
Act of 2018 (Public Law 115-160; 132 Stat. 1246).
(3) Open recommendations.--Not later than 60 days after the
date of enactment of this Act, the Director of the United
States Secret Service shall submit to the appropriate
committees of Congress a report discussing the progress of
the United States Secret Service in implementing each
recommendation of the Government Accountability Office to the
United States Secret Service that has not been designated as
closed by the Comptroller General of the United States.
(4) Protective mission panel.--Not later than 1 year after
the date of enactment of this Act, the Comptroller General of
the United States shall submit to the appropriate committees
of Congress a report on the extent of the progress made by
the United States Secret Service in implementing the
recommendations of the United States Secret Service
Protective Mission Panel, including in particular those items
pertaining to training and personnel enumerated in the
Executive Summary to Report from the United States Secret
Service Protective Mission Panel to the Secretary of Homeland
Security dated December 15, 2014.
(c) Repeal of Superseded Reporting Requirement.--Section
2(b) of the Secret Service Overtime Pay Extension Act (Public
Law 115-383; 132 Stat. 5121) is repealed.
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