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Full Text of this Amendment

SA 3402. Mr. LeMIEUX submitted an amendment intended to be proposed to amendment SA 3336 proposed by Mr. Baucus to the bill H.R. 4213, to amend the Internal Revenue Code of 1968 to extend certain expiring provisions, and for other purposes; which was ordered to lie on the table; as follows:

On page 268, between lines 11 and 12, insert the following:
SEC. __X. MODIFICATIONS TO RUM COVER-OVER PROGRAM.
(a) In General.--Section 7652 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:
"(h) Distribution of Rum Taxes Between Puerto Rico and the Virgin Islands.--
"(1) IN GENERAL.--Except as provided in paragraph (2), for purposes of subsections (a)(3)(B), (b)(3)(B), and (e)(2), the amount to be divided between and covered into the treasury of any applicable territory under this subsection shall bear the same ratio to the total amount covered into the treasuries of all applicable territories under subsection (a)(3)(B), (b)(3)(B), or (e)(2), as the case may be, as the population of such applicable territory bears to the total combined population
of all applicable territories.
"(2) TRANSITION RULE.--In the case of any calendar year before 2030, the amount to be divided between and covered into the treasury of any applicable territory under this subsection shall be equal to the sum of--
"(A) the amount which would be determined under subsection (a)(3)(B), (b)(3)(B), or (e)(2), as the case may be, with respect to such applicable territory before the date of the enactment of this subsection, plus
"(B) the product of--
"(i) the transition percentage, and
"(ii) the difference of--
"(I) the amount which would be determined under paragraph (1) for such calendar year if this paragraph did not apply, minus
"(II) the amount described in subparagraph (A).
"(3) DEFINITIONS AND OTHER RULES.--For purposes of this section--
"(A) APPLICABLE TERRITORY.--The term `applicable territory' means Puerto Rico and the Virgin Islands.
"(B) POPULATION.--For purposes of paragraph (1), the respective populations of the applicable territories shall be determined on the basis of the most recent census estimate of the resident population of each released by the Bureau of the Census before the beginning of the calendar year.
"(C) TRANSITION PERCENTAGE.--
"(i) IN GENERAL.--The transition percentage for calendar year 2010 is 5 percent.
"(ii) SUBSEQUENT YEARS.--In the case of any calendar year beginning after 2010, the transition percentage shall the percentage (not to exceed 100 percent) equal to the sum of the transition percentage for the preceding calendar year plus 5 percentage points.".
(b) Conforming Amendments.--
(1) SHIPMENTS FROM PUERTO RICO.--Paragraph (3) of section 7652(a) of the Internal Revenue Code of 1986 is amended to read as follows:
"(3) DEPOSIT OF INTERNAL REVENUE COLLECTIONS.--
"(A) IN GENERAL.--Except as provided in subparagraph (B), all taxes collected under the internal revenue laws of the United States on articles produced in Puerto Rico and transported to the United States (less the estimated amount necessary for payment of refunds and drawbacks), or consumed in the island, shall be covered into the treasury of Puerto Rico.
"(B) RUM.--All taxes collected under the internal revenue laws of the United States on rum (as defined in subsection (e)(3)) produced in Puerto Rico and transported to the United States (less the estimated amount necessary for payment of refunds and drawbacks), or consumed in the island, shall be divided between and covered into the treasuries of the applicable territories as provided in subsection (i).".
(2) SHIPMENTS FROM THE VIRGIN ISLANDS.--Paragraph (3) of section 7652(b) of such Code is amended to read as follows:
"(3) DISPOSITION OF INTERNAL REVENUE COLLECTIONS.--
"(A) IN GENERAL.--The Secretary shall determine the amount of all taxes imposed by, and collected under the internal revenue laws of the United States on articles not described in subparagraph (B) which are produced in the Virgin Islands and transported to the United States. The amount so determined, plus the amounts determined with respect to the Virgin Islands under subparagraph (B) and subsection (a)(3)(B), less 1 percent of the total of such amounts and less the estimated amount
of refunds or credits, shall be subject to disposition as follows:
"(i) The payment of an estimated amount shall be made to the government of the Virgin Islands before the commencement of each fiscal year as set forth in section 4(c)(2) of the Act entitled `An Act to authorize appropriations for certain insular areas of the United States, and for other purposes', approved August 18, 1978 (48 U.S.C. 1645), as in effect on the date of the enactment of the Trade and Development Act of 2000. The payment so made shall constitute a separate fund in the treasury
of the Virgin Islands and may be expended as the legislature may determine.
"(ii) Any amounts remaining shall be deposited in the Treasury of the United States as miscellaneous receipts.

If at the end of any fiscal year the total of the Federal contribution made under clause (i) with respect to the four calendar quarters immediately preceding the beginning of that fiscal year has not been obligated or expended for an approved purpose, the balance shall continue available for expenditure during any succeeding fiscal year, but only for emergency relief purposes and essential public projects. The aggregate amount of moneys available for
expenditure for emergency relief purposes and essential public projects only shall not exceed the sum of $5,000,000 at the end of any fiscal year. Any unobligated or unexpended balance of the Federal contribution remaining at the end of a fiscal year which would cause the moneys available for emergency relief purposes and essential public projects only to exceed the sum of $5,000,000 shall thereupon be transferred and paid over to the Treasury of the United States as miscellaneous receipts.
"(B) RUM.--The Secretary shall determine the amount of all taxes imposed by, and collected under the internal revenue laws of the United States on rum (as defined in subsection (e)(3)) produced in the Virgin Islands and transported to the United States. The amount so determined shall be divided between and covered into the treasuries of the applicable territories as provided in subsection (i).".
(3) OTHER SHIPMENTS TO THE UNITED STATES.--Paragraph (2) of section 7652(e) of such Code is amended to read as follows:
"(2) DISTRIBUTION OF TAXES.--Such tax collections shall be divided between Puerto Rico and the Virgin Islands as provided in subsection (i). The Secretary shall prescribe by regulation the timing and methods for transferring such tax collections.".
(c) Permanent Extension of Increased Limitation on Cover Over.--Paragraph (1) of section 7652(f) of the Internal Revenue Code of 1986 is amended by striking "$10.50 ($13.25 in the case of distilled spirits brought into the United States after June 30, 1999, and before January 1, 2010)" and inserting "$13.25".
(d) Effective Dates.--
(1) IN GENERAL.--Except as provided in paragraph (2), the amendments made by this section shall apply to taxes collected after the date of the enactment of this Act.
(2) LIMITATION ON COVER-OVER.--The amendment made by subsection (c) shall apply to distilled spirits brought into the United States after December 31, 2009.


(As printed in the Congressional Record for the Senate on Mar 4, 2010.)