Sec. 821. Tax on Securities Transactions

778 words·~4 min read·/bill/114/hr/1200/ih/section-821

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Chapter 36 is amended by inserting after subchapter B the following new subchapter: Sec. 4475. Tax on securities transactions. There is hereby imposed a tax on each covered transaction in a stock contract of 0.25 percent of the value of the instruments involved in such transaction. There is hereby imposed a tax on each covered transaction in a futures contract of 0.02 percent of the value of the instruments involved in such transaction. There is hereby imposed a tax on each covered transaction in a swaps contract of 0.02 percent of the value of the instruments involved in such transaction.

There is hereby imposed a tax on each covered transaction in a credit default swaps contract of 0.02 percent of the value of the instruments involved in such transaction. There is hereby imposed a tax on each covered transaction in an options contract with respect to a transaction described in paragraph (1), (2), (3), or

(4)of— the rate imposed with respect to such underlying transaction under paragraph (1), (2), (3), or

(4)(as the case may be), multiplied by the premium paid on such option. No tax shall be imposed under subsection

(a)with respect to any stock contract, futures contract, swaps contract, credit default swap, or options contract which is held in any plan, account, or arrangement described in section 220, 223, 401(a), 403(a), 403(b), 408, 408A, 457(b), 529, or 530. No tax shall be imposed under subsection

(a)with respect to the purchase or sale of any interest in a regulated investment company (as defined in section 851) or of any derivative of such an interest. The tax imposed by this section shall be paid by— in the case of a transaction which occurs on a trading facility located in the United States, such trading facility, or in any other case, the purchaser with respect to the transaction. See section 1447 for withholding by seller if buyer is a foreign person. The term covered transaction means any purchase or sale if— such purchase or sale occurs on a trading facility located in the United States, or the purchaser or seller is a United States person. The Secretary shall carry out this section in consultation with the Securities and Exchange Commission and the Commodity Futures Trading Commission. . Subpart C of part IV of subchapter A of chapter 1 is amended by inserting after section 36B the following new section: In the case of any purchaser with respect to a covered transaction, there shall be allowed as a credit against the tax imposed by this subtitle for the taxable year an amount equal to the lesser of— the aggregate amount of tax imposed under section 4475 on covered transactions during the taxable year with respect to which the taxpayer is the purchaser, or $250 ($500 in the case of a joint return). For purposes of this section, all persons treated as a single employer under subsection

(a)or

(b)of section 52, or subsection

(m)or

(o)of section 414, shall be treated as one taxpayer. For purposes of this section, any term used in this section which is also used in section 4475 shall have the same meaning as when used in section 4475. . Subchapter A of chapter 3 is amended by adding at the end the following new section: In the case of any outbound securities transaction, the transferor shall deduct and withhold a tax equal to the tax imposed under section 4475 with respect to such transaction. For purposes of this section, the term outbound securities transaction means any covered transaction to which section 4475(a) applies if— such transaction does not occur on a trading facility located in the United States, and the purchaser with respect to such transaction is not a United States person. . Section 6211(b)(4)(A) is amended by inserting 36C, after 36B, . Section 1324(b)(2) of title 31, United States Code, is amended by inserting 36C, after 36B, . The table of subchapters for chapter 36 is amended by inserting after the item relating to subchapter B the following new item: Subchapter C. Tax on securities transactions . The table of sections for subchapter A of chapter 3 is amended by adding at the end the following new item: Sec. 1447. Withholding on securities transactions. . The table of sections for subpart C of part IV of subchapter A of chapter 1 is amended by inserting after the item relating to section 36B the following new item: Sec. 36C. Credit for securities transaction taxes. . The amendments made by this section shall apply to transactions occurring more than 180 days after the date of the enactment of this Act.