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H.R. 1956 (113th): War on Debt Act of 2013

The text of the bill below is as of May 13, 2013 (Introduced).

I

113th CONGRESS

1st Session

H. R. 1956

IN THE HOUSE OF REPRESENTATIVES

May 13, 2013

introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend title 31, United States Code, to provide for the issuance of War on Debt Bonds.

1.

Short title

This Act may be cited as the War on Debt Act of 2013 .

2.

War on Debt Bonds

(a)

In general

Subchapter I of chapter 31 of subtitle III of title 31, United States Code, is amended by inserting after section 3105 the following new section:

3105a.

War on Debt Bonds

(a)

The Secretary shall establish and administer a new series of United States savings bonds, to be known as War on Debt Bonds. Proceeds from the bonds shall be used first solely to reduce the amount of foreign-held public debt, and then to reduce other public debt.

(b)

A War on Debt Bond shall not mature, and may not be redeemed by the holder, earlier than 50 years from the date of issue. An amount equal to 1/50 of the principal amount of any such bond shall be paid to the holder of such bond on the 5th anniversary, and each anniversary thereafter, and shall not be includible in gross income under the Internal Revenue Code of 1986. Interest shall be paid annually on the anniversary date of issuance, and shall not be includible in gross income under such Code.

(c)

War on Debt Bonds shall be issued at face value and in denominations of not less than $10,000, and shall bear interest at a rate determined by the Secretary to be equal to 90 percent of the interest rate for substantially similar AA rated State bonds, adjusted annually.

(d)

If during any fiscal year during which any War on Debt Bond is outstanding—

(1)

the Federal budget deficit for such fiscal year exceeds 3 percent of gross domestic product (as most recently computed and published by the Department of Commerce); or

(2)

the public debt exceeds 10 percent of gross domestic product (as so computed and published);

then any such bond may be redeemed without regard to subsection (b).
(e)

A War on Debt Bond may only be held by—

(1)

a citizen or resident of the United States;

(2)

a domestic partnership, or domestic corporation, not more than 1 percent of the ownership interest of which is held (directly or indirectly) by a person who is not a United States person (as defined in section 7701(a)(30) of the Internal Revenue Code of 1986); or

(3)

an estate or trust which is a United States person (as so defined), unless there is a beneficiary of the trust who is not a United States person (as so defined).

.

(b)

Clerical amendment

The table of sections for subchapter I of chapter 31 of subtitle III of title 31, United States Code, is amended by inserting after section 3105 the following new item:

3105a. War on Debt Bonds.

.