Tax Reform and Competitiveness Act

Summary

Tax Reform and Competitiveness Act - Title I: Value Added Tax - Amends the Internal Revenue Code to impose a tax of five percent on commercial-type transactions, including the sale of property, the performance of services, and the importing of property into the United States. Excludes from such tax the retail sale of food, the sale and renting of residential property as a principal residence, medical care, sales by farmers or fishermen, mass transit, exports, interest, and sales to governmental entities. Title II: Reduction of Social Security Tax Rates - Reduces the rate of tax on employees, employers, and the self-employed for old-age, survivors, and disability insurance for taxable year 1990. Establishes such tax for 1991 and thereafter. Title III: Investment Tax Credit - Establishes a five percent investment tax credit for certain property placed in service after December 31, 1989. Title IV: Individual Retirement Accounts - Allows distributions from individual retirement plans without penalty to purchase first homes or to pay higher education expenses. Allows a tax deduction for 50 percent of contributions paid to an individual retirement plan. Title V: Capital Gains Provisions - Provides a reduction in the capital gains tax for noncorporate taxpayers. Provides for not taking into account net capital gain under the phaseout of the 15 percent rate and personal exemptions and for recapturing the gain from disposition of certain depreciable property. Title VI: Federal Revenue Sharing - Establishes the Revenue Sharing Fund for payments to States to provide supplemental funding for primary, elementary, and secondary public education. Authorizes appropriations.

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2 official files

• Introduced in Senate (text)

  Introduced in Senate · EN

  ViewDownloadOpen at official source

• Introduced in Senate

  summary · EN · 6 February 1990

  Open at official source

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