Summary: S.169 — 102nd Congress (1991-1992)All Information (Except Text)

There is one summary for S.169. Bill summaries are authored by CRS.

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Introduced in Senate (01/14/1991)

Deficit and Debt Reduction Act of 1991 - Amends the Internal Revenue Code to create a new excise tax, a value added tax. Applies the tax to any sale or importation of property or services in the United States by a person engaging in a business. Sets the tax rate at five percent of the amount charged the purchaser by the seller of the taxable property or services.

Prescribes rules to govern the taxable amount in cases of exchanges, imports, and certain sales.

Makes the sale of property and services by a government entity or exempt organization a taxable transaction only if a charge or fee is imposed.

Exempts from the value added tax the supply without consideration of property or services by a government entity or exempt organization.

Permits as a credit against the tax the aggregate amount of tax: (1) paid by sellers to the taxpayer of property and services that the taxpayer uses in the business to which the transaction relates; or (2) reported by the taxpayer as importer of such property or services.

Describes credits against such tax for: (1) certain purchases from a consumer; (2) post-sale price adjustments and refunds; and (3) casual sales.

Describes administrative provisions to govern the tax, placing liability on the seller. Establishes special rules for: (1) self-consumption of certain property or services; and (2) insurance contracts.

Sets forth the time and place for payment of the value added tax and penalties for failure to file required documents.

Amends Federal law to establish in the Treasury the Deficit Reduction Trust Fund to receive amounts generated from the value added tax. Earmarks Fund monies exclusively to pay, redeem, or purchase before maturity any obligations of the Federal Government included in the public debt. Excludes the Fund from deficit calculations for purposes of the Balanced Budget and Emergency Deficit Control Act of 1985 (Gramm-Rudman-Hollings Act).