H.R. 2189, State Tax Freedom Act
Summary
H.R. 2189, the State Tax Freedom Act, was introduced March 26, 2021 by Mr. Brady (for himself, Mr. Comer, Mr. Smith of Missouri, and other Members) and referred to the Committee on Ways and Means, and in addition to the Committee on Oversight and Reform. It would eliminate the prohibition on States and territories receiving Coronavirus State Fiscal Recovery funds from lowering taxes. It inserts section 6424 in the Internal Revenue Code of 1986, under which the Secretary makes a payment to a specified State equal to a specified repayment as soon as practicable after the State pays it. The amendments apply to repayments that would otherwise be required after enactment.
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Cite this document
“H.R. 2189, State Tax Freedom Act.”
Original at www.govinfo.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/bills-bills-117hr2189ih-bills-117hr2189ih/
, SHA-256 22fdd73db25b7de2982b1b5680d0092936ca89418399fc7a275500fb0d4a680d.Full text
I
117TH CONGRESS
1ST SESSION
H. R. 2189
To eliminate the prohibition on States and territories receiving Coronavirus
State Fiscal Recovery funds from lowering taxes.
IN THE HOUSE OF REPRESENTATIVES
MARCH 26, 2021
Mr. BRADY (for himself, Mr. COMER, Mr. SMITH of Missouri, Mrs. WALORSKI,
Mr. ARRINGTON, Mr. JORDAN, Mr. C. SCOTT FRANKLIN of Florida, Mr.
ESTES, Mr. NUNES, Mr. SCHWEIKERT, Mr. WENSTRUP, Mr. HERN, Ms.
HERRELL, Mr. BIGGS, Mr. GOSAR, Mr. KELLER, Ms. FOXX, Mr. HIG-
GINS of Louisiana, Mr. HICE of Georgia, Mr. CLOUD, Mr. SESSIONS, Mr.
GROTHMAN, Mr. LATURNER, and Mr. GIBBS) introduced the following
bill; which was referred to the Committee on Ways and Means, and in
addition to the Committee on Oversight and Reform, for a period to be
subsequently determined by the Speaker, in each case for consideration
of such provisions as fall within the jurisdiction of the committee con-
cerned
A BILL
To eliminate the prohibition on States and territories receiv-
ing Coronavirus State Fiscal Recovery funds from low-
ering taxes.
1 Be it enacted by the Senate and House of Representa-
2 tives of the United States of America in Congress assembled,
3 SECTION 1. SHORT TITLE.
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4 This Act may be cited as the ‘‘State Tax Freedom
5 Act’’.
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2
1 SEC. 2. REFUNDS TO OFFSET CORONAVIRUS STATE FISCAL
2 RECOVERY FUNDS ALREADY REPAID BY REA-
3 SON LOWERING TAXES.
4 (a) IN GENERAL.—Subchapter B of chapter 65 of the
5 Internal Revenue Code of 1986 is amended by inserting
6 after section 6423 the following new section:
7 ‘‘SEC. 6424. REFUNDS TO STATES TO OFFSET CERTAIN RE-
8 QUIRED REPAYMENTS OF CORONAVIRUS
9 STATE FISCAL RECOVERY FUNDS.
10 ‘‘(a) IN GENERAL.—As soon as practicable after any
11 specified State pays any specified repayment, the Sec-
12 retary shall make a payment to such specified State in
13 an amount equal to such specified repayment.
14 ‘‘(b) SPECIFIED REPAYMENT.—For purposes of this
15 section, the term ‘specified repayment’ means any repay-
16 ment required to be made under subsection (e) of section
17 602 of the Social Security Act by reason of subsection
18 (c)(2)(A) thereof.
19 ‘‘(c) SPECIFIED STATE.—The term ‘specified State’
20 means any State, territory, or Tribal government which
21 is required to make to any specified repayment.
22 ‘‘(d) OTHER TERMS.—The terms ‘State’, ‘territory’,
23 and ‘Tribal government’ shall have the same respective
24 meanings as when used in section 602 of the Social Secu-
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25 rity Act.
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1 ‘‘(e) TREATMENT OF PAYMENTS.—For purposes of
2 section 1324 of title 31, United States Code, the payments
3 under this subsection shall be treated in the same manner
4 as a refund due from a credit provision referred to in sub-
5 section (b)(2) of such section.’’.
6 (b) CLERICAL AMENDMENT.—The table of sections
7 for subchapter B of chapter 65 of such Code is amended
8 by inserting after the item relating to section 6423 the
9 following new item:
‘‘Sec. 6424. Refunds to States to offset certain required repayments of
coronavirus State and local fiscal recovery funds.’’.
10 (c) EFFECTIVE DATE.—The amendments made by
11 this section shall apply to repayments paid after the date
12 of the enactment of the American Rescue Plan Act of
13 2021.
14 SEC. 3. ELIMINATION OF PROHIBITION ON STATES RECEIV-
15 ING CORONAVIRUS STATE FISCAL RECOVERY
16 FUNDS FROM LOWERING TAXES.
17 (a) IN GENERAL.—Paragraph (2) of section 602(c)
18 of the Social Security Act, as added by section 9901 of
19 the American Rescue Plan Act of 2021, is amended to
20 read as follows:
21 ‘‘(2) FURTHER RESTRICTION ON USE OF
22 FUNDS.—No State or territory may use funds made
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23 available under this section for deposit into any pen-
24 sion fund.’’.
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1 (b) CONFORMING AMENDMENTS.—Section 602 of
2 such Act is further amended—
3 (1) in subsection (d)(2)(A), by striking ‘‘, in-
4 cluding, in the case of a State or a territory, all
5 modifications to the State’s or territory’s tax rev-
6 enue sources during the covered period’’;
7 (2) in subsection (e), by striking ‘‘such sub-
8 section,’’ and all that follows through the period and
9 inserting ‘‘such subsection.’’; and
10 (3) in subsection (g)—
11 (A) by striking paragraph (1); and
12 (B) by redesignating paragraphs (2)
13 through (7) as paragraphs (1) through (6), re-
14 spectively.
15 (c) EFFECTIVE DATE.—The amendments made by
16 this section shall apply with respect to repayments which
17 would (but for such amendments) be required to be paid
18 after the date of the enactment of this Act.
Æ
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