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Bill
Notes

Title II — Tax Provisions

H.R. 2452 · 116th Congress · May 1, 2019 · Lineage

II Tax Provisions

201. Sunset of Public Law 115–97

(a)
In general— All provisions of, and amendments made by, Public Law 115–97 shall not apply to calendar, taxable, plan, or limitation years beginning after December 31, 2019.
(b)
Application of certain laws— The Internal Revenue Code of 1986 shall be applied and administered to years described in subsection (a) as if the provisions and amendments described in subsection (a) had never been enacted.

202. Surtax

There is hereby imposed a tax of 5 percent on the adjusted gross income of each taxpayer to the extent such income exceeds $500,000.

203. Basis of property acquired from a decedent

(a)
In general— Section 1014 of the Internal Revenue Code of 1986 is amended by striking “person, be” and all that follows through the period at the end and inserting the following: “person, be the basis in the hands of the decedent.”.
(b)
Effective date— The amendments made by this section to property acquired or passed after the date of enactment of this Act.

204. Medicare payroll tax

(a)
In general— Section 3101(b)(2) of the Internal Revenue Code of 1986 is amended by striking “0.9 percent” and inserting “4 percent”.
(b)
Effective date— The amendments made by this section shall apply with respect to taxable years beginning after the date of the enactment of this Act.

205. Net investment income tax

(a)
In general— Section 1411(a) of the Internal Revenue Code of 1986 is amended by striking “3.8 percent” each place such term appears and inserting “6.9 percent”.
(b)
Effective date— The amendments made by this section shall apply with respect to taxable years beginning after the date of the enactment of this Act.

206. Termination of deduction for contributions to health savings accounts

Section 223(b) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

“(9) Termination of deduction—Notwithstanding any other provision of this subsection, the monthly limitation for any month beginning after December 31, 2023, is zero.”

207. Increase in excise tax on small cigars and cigarettes and other tobacco products

(a)
Small cigars— Section 5701(a)(1) of the Internal Revenue Code of 1986 is amended by striking “$50.33” and inserting “$100.66”.
(b)
Cigarettes— Section 5701(b) of such Code is amended—
(1)
by striking “$50.33” in paragraph (1) and inserting “$100.66”; and
(2)
by striking “$105.69” in paragraph (2) and inserting “$211.38”.
(c)
Pipe tobacco— Section 5701(f) of the Internal Revenue Code of 1986 is amended by striking “$2.8311 cents” and inserting “$50.00”.
(d)
Roll-Your-Own tobacco— Section 5701(g) of such Code is amended by striking “$24.78” and inserting “$49.56”.
(e)
Large cigars— Paragraph (2) of section 5701(a) of the Internal Revenue Code of 1986 is amended by striking “52.75 percent” and all that follows through the period and inserting “$24.78 per pound (and a proportionate tax at the like rate on all fractional parts of a pound) but not less than 5.033 cents per cigar.”.
(f)
Smokeless tobacco—
(1)
In general— Section 5701(e) of the Internal Revenue Code of 1986 is amended—
(A)
in paragraph (1), by striking “$1.51” and inserting “$28.04”;
(B)
in paragraph (2), by striking “50.33 cents” and inserting “$12.42”; and
(C)
by adding at the end the following:

“(3) Smokeless tobacco sold in discrete single-use units—On discrete single-use units, $107.65 per each 1,000 single-use units.”

(2)
Discrete single-use unit— Section 5702(m) of such Code is amended—
(A)
in paragraph (1), by striking “or chewing tobacco” and inserting “chewing tobacco, discrete single-use unit”;
(B)
in paragraphs (2) and (3), by inserting “that is not a discrete single-use unit” before the period in each such paragraph; and
(C)
by adding at the end the following:

“(4) Discrete single-use unit—The term discrete single-use unit means any product containing tobacco that—

“(A) is not intended to be smoked; and

“(B) is in the form of a lozenge, tablet, pill, pouch, dissolvable strip, or other discrete single-use or single-dose unit”

208. Excise tax on alcohol

(a)
Distilled spirits— Section 5001(a)(1) of the Internal Revenue Code of 1986 is amended by striking “$13.50” and inserting “$16.00”.
(b)
Wine—
(1)
Section 5041(b)(1) of the Internal Revenue Code of 1986 is amended by striking “$1.07 per wine gallon” and inserting “$16.00 per proof gallon”.
(2)
Section 5041(b)(2) of the Internal Revenue Code of 1986 is amended by striking “$1.57 per wine gallon” and inserting “$16.00 per proof gallon”.
(3)
Section 5041(b)(3) of the Internal Revenue Code of 1986 is amended by striking “$3.15 per wine gallon” and inserting “$16.00 per proof gallon”.
(4)
Section 5041(b)(4) of the Internal Revenue Code of 1986 is amended by striking “$3.40 per wine gallon” and inserting “$16.00 per proof gallon”.
(5)
Section 5041(b)(5) of the Internal Revenue Code of 1986 is amended by striking “$3.30 per wine gallon” and inserting “$16.00 per proof gallon”.
(6)
Section 5041(b)(3) of the Internal Revenue Code of 1986 is amended by striking “$22.6 cents per wine gallon” and inserting “$16.00 per proof gallon”.
(c)
Beer— Section 5051(B) of the Internal Revenue Code of 1986 is amended by striking “$18 for per barrel” and inserting “$16 per proof gallon”.

209. Tax on sugared drinks

(a)
In general— Subchapter D of chapter 32 of the Internal Revenue Code of 1986 is amended by inserting after part I the following new part:

“II Sugar-Sweetened beverages

“4171. Imposition of tax

“(a) In general—There is hereby imposed a tax on the sale or transfer of any specified sugar-sweetened beverage product by the manufacturer, producer, or importer thereof.

“(b) Rate of tax—The rate of tax imposed under subsection (a) shall be equal to one cent per 4.2 grams of caloric sweetener contained in such specified sugar-sweetened beverage product.

“(c) Persons liable for tax—The manufacturer, producer, or importer referred to in subsection (a) shall be liable for the tax imposed by such subsection.

“4172. Definitions

“(a) Specified sugar-Sweetened beverage product—For purposes of this part—

“(1) In general—For purposes of this part, the term specified sugar-sweetened beverage product means—

“(A) any liquid intended for human consumption which contains a caloric sweetener, and

“(B) any liquid, or solid mixture of ingredients, which—

“(i) contains a caloric sweetener, and

“(ii) is intended for use as an ingredient in a liquid described in subparagraph (A).

“(2) Exceptions—The following shall not be treated as liquids described in paragraph (1)(A):

“(A) Any liquid the primary ingredients of which are milk or soy, rice, or similar plant-based milk substitute.

“(B) Any liquid composed entirely of one or more of the following:

“(i) The original liquid resulting from the pressing of fruit or vegetables.

“(ii) The liquid resulting from the reconstitution of fruit or vegetable juice concentrate.

“(iii) The liquid resulting from the restoration of water to dehydrated fruit or vegetable juice.

“(C) Infant formula.

“(D) Any liquid products manufactured for use as—

“(i) an oral nutritional therapy for persons who cannot absorb or metabolize dietary nutrients from food or beverages,

“(ii) a source of necessary nutrition used due to a medical condition, or

“(iii) an oral electrolyte solution for infants and children formulated to prevent dehydration due to illness.

“(E) Any liquid with respect to which tax is imposed under chapter 51 (relating to distilled spirits, wines, and beer) or under section 7652 by reason of the tax imposed under chapter 51 being imposed on like articles of domestic manufacture.

“(b) Caloric sweetener—For purposes of this part, the term caloric sweetener means monosaccharides, disaccharides, and high-fructose corn syrup.

“4173. Special rules

“(a) Sweetener taxed only once—In the case of any specified sugar-sweetened beverage product which is manufactured or produced by including one or more other specified sugar-sweetened beverage products, no tax shall be imposed under this section on any caloric sweetener contained in the resulting specified sugar-sweetened beverage product if tax was previously imposed under this section on such caloric sweetener when contained in the specified sugar-sweetened beverage product so included.

“(b) Inflation adjustment—In the case of any sale after December 31, 2015, the one cent amount in section 4171(b) shall be increased by an amount equal to—

“(1) such amount, multiplied by

“(2) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which such sale occurs, determined by substituting “calendar year 2014” for “calendar year 1992” in subparagraph (B) thereof.”

(b)
Conforming amendments—
(1)
Section 4221(a) is amended by adding at the end the following: “Paragraphs (1), (4), (5), and (6) shall not apply to the tax imposed under section 4171.”.
(2)
The table of parts for subchapter D of chapter 32 of such Code is amended by inserting after the item relating to part I the following new item:
(c)
Effective date—
(1)
In general— Except as provided in paragraph (2), the amendments made by this section shall take effect on the date of the enactment of this Act.
(2)
Excise tax— The amendments made by subsections (a) and (b) shall apply to sales after the date of the enactment of this Act.

210. Repeal of excise tax on high-cost employer-sponsored health coverage

(a)
In general— Chapter 43 of the Internal Revenue Code of 1986 is amended by striking section 4980I.
(b)
Conforming amendment— Section 6051 of such Code is amended—
(1)
in paragraph (14) of subsection (a), by striking “section 4980I(d)(1)” and inserting “subsection (g)”, and
(2)
by adding at the end the following:

“(g) Applicable employer-Sponsored coverage—For purposes of subsection (a)(14)—

“(1) In general—The term applicable employer-sponsored coverage means, with respect to any employee, coverage under any group health plan made available to the employee by an employer which is excludable from the employee’s gross income under section 106, or would be so excludable if it were employer-provided coverage (within the meaning of such section 106).

“(2) Exceptions—The term applicable employer-sponsored coverage shall not include—

“(A) any coverage (whether through insurance or otherwise) described in section 9832(c)(1) (other than subparagraph (G) thereof) or for long-term care;

“(B) any coverage under a separate policy, certificate, or contract of insurance which provides benefits substantially all of which are for treatment of the mouth (including any organ or structure within the mouth) or for treatment of the eye; or

“(C) any coverage described in section 9832(c)(3) the payment for which is not excludable from gross income and for which a deduction under section 162(l) is not allowable.

“(3) Coverage includes employee paid portion—Coverage shall be treated as applicable employer-sponsored coverage without regard to whether the employer or employee pays for the coverage.

“(4) Governmental plans included—Applicable employer-sponsored coverage shall include coverage under any group health plan established and maintained primarily for its civilian employees by the Government of the United States, by the government of any State or political subdivision thereof, or by any agency or instrumentality of any such government.

“(5) Cost of coverage

“(A) Health FSAS—In the case of applicable employer-sponsored coverage consisting of coverage under a flexible spending arrangement (as defined in section 2205(g)), the cost of the coverage shall be equal to the amount determined under rules similar to the rules of section 4980B(f)(4) with respect to any reimbursement under the arrangement reduced by the contributions described in subsection (a)(14)(B).

“(B) Archer msas and hsas—In the case of applicable employer-sponsored coverage consisting of coverage under an arrangement under which the employer makes contributions described in subsection (b) or (d) of section 106, the cost of the coverage shall be equal to the amount of employer contributions under the arrangement until the termination of HSAs as described under section 206 of such Act.

“(C) Allocation on a monthly basis—If cost is determined on other than a monthly basis, the cost shall be allocated to months in a taxable period on such basis as the Secretary may prescribe.”

(c)
Clerical amendment— The table of sections for chapter 43 of such Code is amended by striking the item relating to section 4980I.
(d)
Effective date— The amendments made by this section shall apply to taxable years beginning after December 31, 2019.