Sec. 6. Transaction tax
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Chapter 36 of the Internal Revenue Code of 1986 is amended by inserting after subchapter B the following new subchapter: Sec. 4475. Tax on trading transactions. There is hereby imposed a tax on each covered transaction with respect to any security. The tax imposed under subsection
(a)with respect to any covered transaction shall be 0.03 percent of the specified base amount with respect to such covered transaction. For purposes of this section, the term specified base amount means— except as provided in paragraph (2), the fair market value of the security (determined as of the time of the covered transaction), and in the case of any payment described in subsection (h), the amount of such payment. For purposes of this section, the term covered transaction means— except as provided in paragraph (2), any purchase if— such purchase occurs or is cleared on a facility located in the United States, or the purchaser or seller is a United States person, and any transaction with respect to a security described in subparagraph (D), (E), or
(F)of subsection (e)(1), if— such security is traded or cleared on a facility located in the United States, or any party with rights under such security is a United States person. For purposes of this section— The term security means— any share of stock in a corporation, any partnership or beneficial ownership interest in a partnership or trust, any note, bond, debenture, or other evidence of indebtedness, any evidence of an interest in, or a derivative financial instrument with respect to, any security or securities described in subparagraph (A), (B), or (C), any derivative financial instrument with respect to any currency or commodity, and any other derivative financial instrument any payment with respect to which is calculated by reference to any specified index. The term derivative financial instrument includes any option, forward contract, futures contract, notional principal contract, or any similar financial instrument. The term specified index means any one or more of any combination of— a fixed rate, price, or amount, or a variable rate, price, or amount, which is based on any current objectively determinable information which is not within the control of any of the parties to the contract or instrument and is not unique to any of the parties’ circumstances. An exchange shall be treated as the sale of the property transferred and a purchase of the property received by each party to the exchange. In the case of a distribution treated as an exchange for stock under section 302 or 331, the corporation making such distribution shall be treated as having purchased such stock for purposes of this section. No tax shall be imposed under subsection
(a)on any covered transaction with respect to the initial issuance of any security described in subparagraph (A), (B), or
(C)of subsection (e)(1). A note, bond, debenture, or other evidence of indebtedness which— is traded on a trading facility located in the United States, and has a fixed maturity of not more than 100 days, shall not be treated as described in subsection (e)(1)(C). No tax shall be imposed under subsection
(a)on any covered transaction with respect to which gain or loss is not recognized by reason of section 1058. The tax imposed by this section shall be paid by— in the case of a transaction which occurs or is cleared on a facility located in the United States, such facility, and in the case of a purchase not described in subparagraph
(A)which is executed by a broker (as defined in section 6045(c)(1)) which is a United States person, such broker. In the case of any transaction to which paragraph
(1)does not apply, the tax imposed by this section shall be paid by— in the case of a transaction described in subsection (d)(1)— the purchaser if the purchaser is a United States person, and the seller if the purchaser is not a United States person, and in the case of a transaction described in subsection (d)(2)— the payor if the payor is a United States person, and the payee if the payor is not a United States person. Except as otherwise provided by the Secretary, any payment with respect to a security described in subparagraph (D), (E), or
(F)of subsection (e)(1) shall be treated as a separate transaction for purposes of this section, including— any net initial payment, net final or terminating payment, or net periodical payment with respect to a notional principal contract (or similar financial instrument), any payment with respect to any forward contract (or similar financial instrument), and any premium paid with respect to any option (or similar financial instrument). The Secretary shall carry out this section in consultation with the Securities and Exchange Commission and the Commodity Futures Trading Commission. The Secretary shall— provide guidance regarding such information reporting concerning covered transactions as the Secretary deems appropriate, and prescribe such regulations as are necessary or appropriate to prevent avoidance of the purposes of this section, including the use of non-United States persons in such transactions. . The table of subchapters for chapter 36 of the Internal Revenue Code of 1986 is amended by inserting after the item relating to subchapter B the following new item: Subchapter C. Tax on trading transactions . The amendments made by this section shall apply to transactions made after December 31, 2017.