H.R.2333 - Distilled Spirits Tax Payment Simplification Act of 1995104th Congress (1995-1996)
|Sponsor:||Rep. Ensign, John [R-NV-1] (Introduced 09/14/1995)|
|Committees:||House - Ways and Means|
|Latest Action:||House - 09/14/1995 Referred to the House Committee on Ways and Means. (All Actions)|
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Text: H.R.2333 — 104th Congress (1995-1996)All Information (Except Text)
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Introduced in House (09/14/1995)
[Congressional Bills 104th Congress] [From the U.S. Government Printing Office] [H.R. 2333 Introduced in House (IH)] 1st Session H. R. 2333 To amend the Internal Revenue Code of 1986 to simplify the method of payment of taxes on distilled spirits. _______________________________________________________________________ IN THE HOUSE OF REPRESENTATIVES September 14, 1995 Mr. Ensign (for himself and Mr. Matsui) introduced the following bill; which was referred to the Committee on Ways and Means _______________________________________________________________________ A BILL To amend the Internal Revenue Code of 1986 to simplify the method of payment of taxes on distilled spirits. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE. (a) Short Title.--This Act may be cited as the ``Distilled Spirits Tax Payment Simplification Act of 1995''. (b) Amendment of 1986 Code.--Except as otherwise expressly provided, whenever an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Internal Revenue Code of 1986. SEC. 2. TRANSFER OF DISTILLED SPIRITS BETWEEN BONDED PREMISES. (a) Section 5212 is amended to read as follows: ``SEC. 5212. TRANSFER OF DISTILLED SPIRITS BETWEEN BONDED PREMISES. ``Distilled spirits on which the internal revenue tax has not been paid as authorized by law may, under such regulations as the Secretary shall prescribe, be transferred in bond between bonded premises in any approved container. For the purposes of this chapter, except in the case of any transfer from a premise of a bonded dealer, the removal of distilled spirits for transfer in bond between bonded premises shall not be construed to be a withdrawal from bonded premises.'' (b) The first sentence of section 5232 is amended to read as follows: ``Distilled spirits imported or brought into the United States, under such regulations as the Secretary shall prescribe, may be withdrawn from customs custody and transferred to the bonded premises of a distilled spirits plant without payment of the internal revenue tax imposed on such distilled spirits.'' SEC. 3. ESTABLISHMENT OF DISTILLED SPIRITS PLANT. Section 5171 is amended by-- (1) striking from subsection (a) the phrase ``or processor'' and inserting therein ``processor, or bonded dealer;'' and (2) deleting from subsection (b) the ``or both.'' and inserting thereafter ``as a bonded dealer, or as any combination thereof.'' SEC. 4. DISTILLED SPIRITS PLANTS. Section 5178(a) is amended by adding the following new paragraph after paragraph (4) to read as follows: ``(5) Bonded dealer operations.--Any person establishing a distilled spirits plant to conduct operations as a bonded dealer may, as described in the application for registration-- ``(A) store distilled spirits in any approved container on the bonded premises of such plant, and ``(B) under such regulations as the Secretary shall prescribe, store taxpaid distilled spirits, beer and wine and such other beverages and items (products) not subject to tax or regulation under this title on such bonded premises.'' SEC. 5. BONDED DEALERS. (a) Section 5002(a) is amended by inserting after subsection (a)(15) the following new paragraphs: ``(16) Bonded Dealer.--The term `bonded dealer' means any person who has elected under section 5011 to be treated as a bonded dealer. ``(17) Control State Entity.--The term `control State entity' means a State or a political subdivision of a State in which only the State or a political subdivision thereof is allowed under applicable law to perform distilled spirit operations, or any instrumentality of such a State or political subdivision.'' (b) Subpart A of part I of subchapter A of chapter 51 (relating to distilled spirits) is amended by adding at the end thereof the following new section: ``SEC. 5011. ELECTION TO BE TREATED AS BONDED DEALER. ``(a) Election.--Any wholesale dealer, or any control State entity, may elect, at such time and in such manner as the Secretary shall prescribe, to be treated as a bonded dealer if such wholesale dealer or entity sells bottled distilled spirits exclusively to a wholesale dealer in liquor, to an independent retail dealer subject to the limitation set forth in subsection (b), or to another bonded dealer. ``(b) Special Rules.--(1) Any person, other than a control State entity, who is a bonded dealer shall not be considered as selling to an independent retail dealer if the bonded dealer has a greater than 10 percent ownership interest in, or control of the retail dealer; the retail dealer has a greater than 10 percent ownership interest in, or control of the bonded dealer; or where any person has a greater than 10 percent ownership interest in, or control of both the bonded and retail dealer. For purposes of this subparagraph, ownership interest, not limited to stock ownership, shall be attributed to other persons in the manner prescribed by section 318. ``(2) In the case of any control State entity, subsection (a) shall be applied without regard to the word `independent'''. ``(c) Inventory Owned at Time of Election.--Any bottled distilled spirits in the inventory of any person electing under section 5011 to be treated as a bonded dealer shall, to the extent that the Federal excise tax previously has been determined and paid at the time the election becomes effective, not be subject to additional Federal excise tax on such spirits as a result of the election being in effect. ``(d) Revocation of Election.--The election made under this section may be revoked by the bonded dealer at any time, but once revoked shall not be made again without the consent of the Secretary. When the election is revoked, the bonded dealer shall immediately withdraw the distilled spirits on determination of tax in accordance with a tax payment procedure established by the Secretary. ``(e) Equitable Treatment of Bonded Dealers Using LIFO Inventory.-- The Secretary shall provide such rules as may be necessary to assure that taxpayers using the last-in first-out method of inventory valuation do not suffer a recapture of their LIFO reserve by reason of making the election under section 5011 or by reason of operating a bonded wine cellar as permitted by section 5351. ``(f) Approval of Application.--Any person submitting an application under section 5171(c) and electing under this section to be treated as a bonded dealer shall be entitled to approval of such application to the same extent they would be entitled to approval of an application for a basic permit under section 204(a)(2) of title 27 of the United States Code (the Federal Alcohol Administration Act) and shall be accorded notice and hearing as described in section 204(b) of such title 27.'' (c) Conforming amendment.--The tables of sections of subpart A of part I of subchapter A of chapter 51 and the table of contents of subtitle E are amended by adding at the appropriate places: ``Sec. 5011. Election To Be Treated As Bonded Dealer.'' SEC. 6. DETERMINATION OF TAX. Section 5006 is amended by amending the first sentence of subsection (a)(1) to read as follows: ``Except as otherwise provided in this section, the tax on distilled spirits shall be determined when the spirits are transferred from a distilled spirits plant to a bonded dealer or are withdrawn from bond.'' SEC. 7. LOSS OR DESTRUCTION OF DISTILLED SPIRITS. (a) Subsections (a)(1)(A) and (a)(2) of section 5008 are amended by adding ``bonded dealer,'' immediately after ``distilled spirits plant''. (b) Subsection (c)(1) of section 5008 is amended by striking the words ``of a distilled spirits plant''. (c) Subsection (c)(2) of section 5008 is amended by striking the words ``distilled spirits plant'' and inserting in lieu thereof the words ``bonded premises''. SEC. 8. TIME FOR COLLECTING TAX ON DISTILLED SPIRITS. (a) In section 5061(d) redesignate paragraph (5) as paragraph (6) and insert after paragraph (4) the following new paragraph: ``(5) Advanced payment of distilled spirits tax.-- Notwithstanding the preceding provisions of this subsection, in the case of any tax imposed by section 5001 with respect to a bonded dealer who has an election in effect on September 20 of any year, any payment of which would, but for this paragraph, be due in October or November of that year, shall be made on such September 20. No penalty or interest shall be imposed for the period from such September 20 until the due date determined without regard to this paragraph to the extent that tax due exceeds the tax which would have been due with respect to distilled spirits in the preceding October and November had the election under section 5011 been in effect.'' (b) Section 5061(e) is amended by inserting in paragraph (1) the words ``or any bonded dealer,'' immediately after ``respectively,''. SEC. 9. EXEMPTION FROM OCCUPATIONAL TAX NOT APPLICABLE. Section 5113(a) is amended by adding immediately after the last sentence the following new sentence to read as follows: ``This exemption shall not apply to a proprietor of a distilled spirits plant whose premises are used for operations of a bonded dealer.'' SEC. 10. TECHNICAL, CONFORMING AND CLERICAL AMENDMENTS. (a) Technical and Conforming Amendments.-- (1) Section 5003(3) is amended to delete the term ``certain'' from the sentence. (2) Section 5214 is amended by redesignating subsection (b) as (c) and inserting a new subsection (b) to read as follows: ``(b) Exception.--Subsections (a) (1), (2), (3), (5), (10), (11), and (12) of this section shall not apply to distilled spirits withdrawn from premises used for operations as a bonded dealer.'' (3) Section 5215(a) is amended by inserting a period after the word ``plant'' and striking the words ``but only for destruction, denaturation, redistillation, reconditioning, or rebottling:''. (4) Section 5362(b)(5) is amended by adding the following sentence to read as follows: ``This term will not apply to premises used for operations as a bonded dealer.''. (5) Section 5551(a) is amended by inserting after the term ``processor'' at each place it appears the phrase ``bonded dealer,''. (6) Section 5601(a) (2), (3), (4), (5), and (b) are amended by inserting ``, bonded dealer'' immediately before the word ``processor'' at each place it appears. (7) Section 5602 is amended by inserting ``, warehouseman, processor, or bonded dealer'' immediately after the word ``distiller''. (8) Section 5115, 5180, and 5681 are repealed. (b) Clerical Amendments.-- (1) The table of sections for part II of subchapter A of chapter 51 is amended by striking out the item relating to section 5115. (2) The table of sections for subchapter B of chapter 51 is amended by striking out the item relating to section 5180. (3) The table of sections for part IV of subchapter J of chapter 51 is amended by striking out the item relating to section 5681. SEC. 11. EFFECTIVE DATE. (a) Except as provided in subsection (b) the provisions of this Act shall take effect one hundred and twenty days following enactment. (b)(1) The amendments made by section 3 of this Act shall take effect on the date of enactment of this Act, and (2) Each wholesale dealer who is required to file an application for registration under section 5171(c) whose operations are required to be covered by a basic permit under the Federal Alcohol Administration Act (27 U.S.C. 203 and 204) and who has received such basic permits as an importer, wholesaler, or as both, and has obtained a bond required under this subchapter before the close of the fourth month following enactment of this Act, shall be qualified to operate bonded premises until such time as the Secretary takes final action on the application. Any control State entity that has obtained a bond required under this subchapter shall be qualified to operate bonded premises until such time as the Secretary takes final action on the application for registration under section 5171(c). <all>