An act to promote economic revitalization and facilitate expansion of economic opportunities in the Caribbean Basin region, to provide for backup withholding of tax from interest and dividends, and for other purposes.

(Conference Report filed in House, H. Rept. 98-325) Title I: Interest and Dividend Tax Compliance - Interest and Dividend Tax Compliance Act of 1983 - Amends the Tax Equity and Fiscal Responsibility Act of 1982 to repeal, as of June 30, 1983, provisions which require the withholding of tax on interest and dividends. Permits the payor of interest and dividends paid before September 2, 1983, to elect to have the repeal apply to amounts which are deducted and withheld before that date. Exempts a taxpayer who underpays his estimated tax in reliance upon the withholding requirement from the penalties for underpayment of tax. Expresses the sense of the Congress with respect to increased appropriations for purposes of collecting tax on dividends and interest during FY 1984 through FY 1988. Provides for a system of backup withholding for taxpayers who underreport interest and dividend income or who fail to provide accurate taxpayer information. Requires the payor of any amount of income to deduct and withhold 20 percent of such payment if the payee fails to provide a taxpayer identification number or provides an incorrect one. Requires the payor of interest and dividend income to withhold 20 percent of such amounts if such payor receives notice from the Internal Revenue Service that his payee has underreported interest and dividend income or has not properly certified that he is exempt from a withholding requirement. Imposes a $500 penalty upon retail brokers for each intentional failure to provide a payor of reportable payments with a taxpayer identification number or a backup withholding status report. Imposes a penalty for failure to provide a taxpayer identification number, or any statement or return, with respect to the reporting of interest and dividend income. Removes the $50,000 limitation on the total amount of such penalty. Exempts a taxpayer from a penalty if he can show due diligence in attempting to satisfy the requirement. Makes such penalty self- assessable on the taxpayer's return as an excise tax. Applies the negligence penalty for underpayment of tax to payees of interest and dividend income who fail to report all such income. Requires clear and convincing evidence of due care to overcome a presumption of negligence in such cases. Imposes the civil penalty for providing false information with respect to withholding on a failure to provide backup withholding information. Imposes a criminal penalty for providing false backup withholding information. Requires payors of interest and dividend income to mail statements of such income to payees in a separate mailing. Requires any payor of interest or dividend income who is required to file more than 50 information returns to file such returns on magnetic media. Authorizes the Internal Revenue Service to make exceptions to this requirement in hardship cases. Requires the Secretary of the Treasury, in consultation with the Secretary of Health and Human Services, to conduct a study of the feasibility of requiring persons to file, on magnetic media, W-2 reports concerning wage income. Title II: Caribbean Basin Initiative - Caribbean Basin Economic Recovery Act - Subtitle A: Duty-Free Treatment - Authorizes the President to proclaim duty-free treatment for all eligible articles from Caribbean countries that the President designates as beneficiary countries. Requires the President to notify Congress before making such a designation. Prohibits the President from terminating such a designation unless both Houses of Congress are notified 60 days before the termination. Requires the President to consider only specified countries and territories as beneficiary countries. Prohibits the President from designating a country as a beneficiary country: (1) if it is a Communist country; (2) if it has nationalized or seized control, or effectively nationalized or seized control, of U.S. property, unless the President determines that a good faith effort is being made to compensate for such seizure; (3) if it fails to act in good faith in recognizing as binding or in enforcing arbitral awards in favor of U.S. citizens or corporations; (4) if it grants preferential treatment to the products of a developed country other than the United States which may have a significant adverse effect on U.S. commerce, unless the President reports to Congress that certain assurances have been made; (5) if it has a government-owned entity engaged in broadcasting copyrighted material belonging to U.S. copyright owners without their express consent; (6) if it does not take adequate steps to cooperate with the United States to prevent narcotic drugs from entering the United States unlawfully; or (7) unless an extradition treaty exists between the United States and such country. Permits the President to designate as a beneficiary country a Communist country, an expropriating country, a country that fails to act in good faith with respect to an arbitral award, or a country which violates a copyright, if the President determines and reports to Congress that such designation will be in the national interest. Lists factors the President should consider in determining whether to grant beneficiary designation. Amends the Tariff Schedules of the United States to grant to imports from U.S. insular possessions, subject to specified provisions of this Act, duty treatment no less favorable than the treatment afforded such imports from a beneficiary country. Directs the President to withdraw or suspend a country's beneficiary designation, if the President determines that changed circumstances in such country would prohibit such designation under the guidelines in this title. Requires duty-free treatment to apply to any article imported from a beneficiary country, unless otherwise excluded from eligibility, if: (1) the article is imported directly from such country into U.S. customs territory; and (2) the sum of specified costs of the article is not less than 35 percent of its appraised value at the time of its entry. Directs the Secretary of the Treasury to prescribe regulations governing articles eligible for such duty-free treatment, including the requirement that such articles must be wholly the product of a beneficiary country or must be a new or different article of commerce which has been produced in the beneficiary country. Prohibits this duty-free treatment from applying to: (1) textile and apparel articles which are subject to tariff agreements; (2) certain footwear, handbags, luggage, flat goods, work gloves, and leather wearing apparel; (3) tuna prepared or preserved in airtight containers; (4) petroleum or certain petroleum products; and (5) watches and watch parts. Directs the President to suspend duty-free treatment of sugar and beef products that are the products of a beneficiary country if: (1) the beneficiary country, within 90 days of its designation as a beneficiary country, does not submit a Stable Food Production Plan to the President for evaluation; (2) the President determines that the Plan of a beneficiary country does not meet specified criteria; or (3) as a result of the monitoring of the operation of the Plan, the President determines that a beneficiary country is not making a good faith effort to implement its Plan, or that the Plan, although being implemented, is not achieving its purposes. Requires the President, before suspending such duty-free treatment, to offer to consult with the country to formulate appropriate remedial action. Requires the President, biennially, to monitor the operation of the Plans implemented by beneficiary countries and to report to Congress. Requires the President to terminate the suspension of duty-free treatment if the beneficiary country has acted to remedy the situation which caused the suspension. Sets forth the manner of governing the importation and duty-free treatment of certain sugars, sirups, and molasses. Authorizes the President to suspend the duty-free treatment provided by this title and to proclaim a duty for an eligible article if such action is taken pursuant to certain import relief or national security provisions. Requires the International Trade Commission (ITC), in any report on a petition for import relief under the Trade Act of 1974, to state how its findings and recommendations apply to any duty-free article imported from beneficiary countries. Authorizes the President to reduce or end the application of import relief measures which apply to articles imported from beneficiary countries earlier than otherwise scheduled. Requires the suspension of duty- free treatment provided by this title to be treated as an increase in duty for purposes of the import relief section of the Trade Act of 1974. Prohibits such a suspension of duty-free treatment unless the ITC finds that the harm caused by the imports results from its duty-free treatment by this title. Authorizes the filing of petitions for import relief with the Secretary of Agriculture (Secretary), as well as with the ITC, for injury from imports of perishable products from beneficiary countries. Directs the Secretary to recommend the granting or denying of such petition within 14 days of its filing. Requires the President to take emergency action or to publish a notice of determination not to take emergency action within seven days of receiving the Secretary's recommendation. Sets forth the limits on the duration of the emergency action. Defines perishable products to include certain live plants, certain fresh or chilled vegetables, fresh mushrooms, fresh fruit, fresh cut flowers, and concentrated citrus fruit juice. Exempts from proclamations under this title certain fees imposed pursuant to the Agricultural Adjustment Act. Provides for duty-free treatment of articles imported directly from Puerto Rico and the U.S. insular possessions, so long as foreign materials do not account for more than 70 percent of the total value of the articles (or more than 50 percent of the total value with respect to articles excluded from duty-free treatment under the Caribbean Basin Economic Recovery Act). Amends the Tariff Schedules of the United States to increase to five liters (currently, four liters) the amount of duty-free liquor that may be brought into the United States. Requires that not more than four liters of such five liter limit may have been produced outside American Samoa, Guam, or the U.S. Virgin Islands. Authorizes the President to withdraw duty-free treatment on rum if the amount of excise taxes on rum that is paid into the treasuries of Puerto Rico and the Virgin Islands falls below the amount that would have been paid if the rum had been produced in Puerto Rico or the Virgin Islands. Amends the Trade Agreements Act of 1979 to repeal the provision for protecting U.S. possessions against revenue losses caused by concessions granted by the United States in the Tokyo Round of the Multilateral Trade Negotiations. Prohibits any action under this title from affecting a tariff imposed by Puerto Rico on coffee imported into Puerto Rico. Exempts nontoxic rum stillage discharges in the Virgin Islands from certain provisions of the Water Pollution Control Act if the discharges are 1500 feet from the shore and are determined by the Virgin Islands Governor not to constitute a health or environmental hazard. Requires the ITC to report to Congress and the President on the economic impact of this Act on U.S. industries and consumers during: (1) the two year period beginning with the enactment of this Act; and (2) each year afterwards, until duty-free treatment under this title is terminated. Sets forth assessments that the ITC shall make and factors to be considered in making those assessments. Directs the Secretary of Labor, in consultation with other appropriate Federal agencies, to report to Congress on the impact on labor of the implementation of this title. Directs the Secretary of State to prepare a study regarding the feasibility of establishing a Caribbean Trade Institute in New York City. Sets forth factors to be assessed in the study. Terminates duty-free treatment to beneficiary countries under this title after FY 1995. Subtitle B: Tax Provisions - Amends the Internal Revenue Code to require excise taxes on rum imported into the United States to be paid to Puerto Rico and the U.S. Virgin Islands. Allows an income tax deduction for expenses incurred in attending a convention in a beneficiary country named under the provisions of this Act (including Bermuda), if such country has a tax information agreement in effect with the United States and such country's tax laws do not discriminate against conventions held in the United States. Authorizes the Secretary of the Treasury to negotiate and conclude agreements with beneficiary countries for the exchange of tax information required to enforce the tax laws of the respective countries. Directs the Secretary to report to the Congress within 90 days of the enactment of this Act on: (1) the level at which Caribbean Basin tax havens are being used and the effect on Federal revenues of such use; (2) the relationship of such use to drug trafficking and other criminal activities; and (3) current Department of the Treasury enforcement activities against tax havens. Expresses the sense of the Congress that sugar from any Communist country in the Caribbean Basin or in Central America should not be imported into the United States.

(House agreed to Senate amendments with an amendment) Title I: Repeal of Withholding from Interest and Dividends - Amends the Tax Equity and Fiscal Responsibility Act of 1982 to repeal provisions which require the withholding of tax on interest and dividends. Provides for adjustments to pre-July 1983 installments of estimated tax to prevent the assessment of penalties for underpayment of estimated tax made in reliance upon withholding requirements then in effect. Title II: Caribbean Basin Initiative - Caribbean Basin Economic Recovery Act - Subtitle A: Duty-Free Treatment - Authorizes the President to proclaim duty-free treatment for all eligible articles from Caribbean countries that the President designates as beneficiary countries. Requires the President to notify Congress before making such a designation. Prohibits the President from terminating such a designation unless both Houses of Congress are notified 60 days before the termination. Requires the President to consider only specified countries and territories as beneficiary countries. Prohibits the President from designating a country as a beneficiary country: (1) if it is a Communist country; (2) if it has nationalized or seized control, or effectively nationalized or seized control, of U.S. property, unless the President determines that a good faith effort is being made to compensate for such seizure; (3) if it fails to act in good faith in recognizing as binding or in enforcing arbitral awards in favor of U.S. citizens or corporations; (4) if it grants preferential treatment to the products of a developed country other than the United States which may have a significant adverse effect on U.S. commerce, unless the President reports to Congress that certain assurances have been made; (5) if it has a government-owned entity engaged in broadcasting copyrighted material belonging to U.S. copyright owners without their express consent; or (6) unless an extradition treaty exists between the United States and such country. Permits the President to designate as a beneficiary country a Communist country, an expropriating country, or a country that fails to act in good faith with respect to an arbitral award if the President determines and reports to Congress that such designation will be in the national interest. Lists factors the President should consider in determining whether to grant beneficiary designation. Amends the Tariff Schedules of the United States to grant to imports from U.S. insular possessions, subject to specified provisions of this Act, duty treatment no less favorable than the treatment afforded such imports from a beneficiary country. Directs the President to withdraw or suspend a country's beneficiary designation, if the President determines that changed circumstances in such country would prohibit such designation under the guidelines in this title. Requires duty-free treatment to apply to any article imported from a beneficiary country, unless otherwise excluded from eligibility, if: (1) the article is imported directly from such country into U.S. customs territory; and (2) the sum of specified costs of the article is not less than 35 percent of its appraised value at the time of its entry. Directs the Secretary of the Treasury to prescribe regulations governing articles eligible for such duty-free treatment, including the requirement that such articles must be wholly the product of a beneficiary country or must be a new or different article of commerce which has been produced in the beneficiary country. Prohibits this duty-free treatment from applying to: (1) textile and apparel articles which are subject to tariff agreements; (2) certain footwear, handbags, luggage, flat goods, work gloves, and leather wearing apparel; (3) tuna prepared or preserved in airtight containers; and (4) petroleum or certain petroleum products. Directs the President to suspend duty-free treatment of sugar and beef products that are the products of a beneficiary country if: (1) the beneficiary country, within 90 days of its designation as a beneficiary country, does not submit a Stable Food Production Plan to the President for evaluation; (2) the President determines that the Plan of a beneficiary country does not meet specified criteria; or (3) as a result of the monitoring of the operation of the Plan, the President determines that a beneficiary country is not making a good faith effort to implement its Plan, or that the Plan, although being implemented, is not achieving its purposes. Requires the President, before suspending such duty-free treatment, to offer to consult with the country to formulate appropriate remedial action. Requires the President, biennially, to monitor the operation of the Plans implemented by beneficiary countries and to report to Congress. Requires the President to terminate the suspension of duty-free treatment if the beneficiary country has acted to remedy the situation which caused the suspension. Sets forth the manner of governing the importation and duty-free treatment of certain sugars, sirups, and molasses. Authorizes the President to suspend the duty-free treatment provided by this title and to proclaim a duty for an eligible article if such action is taken pursuant to certain import relief or national security provisions. Requires the International Trade Commission (ITC), in any report on a petition for import relief under the Trade Act of 1974, to state how its findings and recommendations apply to any duty-free article imported from beneficiary countries. Authorizes the President to reduce or end the application of import relief measures which apply to articles imported from beneficiary countries earlier than otherwise scheduled. Requires the suspension of duty-free treatment provided by this title to be treated as an increase in duty for purposes of the import relief section of the Trade Act of 1974. Prohibits such a suspension of duty-free treatment unless the ITC finds that the harm caused by the imports results from its duty-free treatment by this title. Authorizes the filing of petitions for import relief with the Secretary of Agriculture (Secretary), as well as with the ITC, for injury from imports of perishable products from beneficiary countries. Directs the Secretary to recommend the granting or denying of such petition within 14 days of its filing. Requires the President to take emergency action or to publish a notice of determination not to take emergency action within seven days of receiving the Secretary's recommendation. Sets forth the limits on the duration of the emergency action. Defines perishable products to include certain live plants, certain fresh or chilled vegetables, fresh mushrooms, fresh fruit, fresh cut flowers, and concentrated citrus fruit juice. Exempts from proclamations under this title certain fees imposed pursuant to the Agricultural Adjustment Act. Provides for duty-free treatment of articles imported directly from Puerto Rico and the U.S. insular possessions, so long as foreign materials do not account for more than 70 percent of the total value of the articles (or more than 50 percent of the total value with respect to articles excluded from duty-free treatment under the Caribbean Basin Economic Recovery Act). Amends the Tariff Schedules of the United States to increase to five liters (currently, four liters) the amounts of duty-free liquor that may be brought into the United States. Requires that not more than four liters of such five liter limit may have been produced outside American Samoa, Guam, or the U.S. Virgin Islands. Authorizes the President to withdraw duty-free treatment on rum if the amount of excise taxes on rum that is paid into the treasuries of Puerto Rico and the Virgin Islands falls below the amount that would have been paid if the rum had been produced in Puerto Rico or the Virgin Islands. Amends the Trade Agreements Act of 1979 to repeal the provision for protecting U.S. possessions against revenue losses caused by concessions granted by the United States in the Tokyo Round of the Multilateral Trade Negotiations. Prohibits any action under this title from affecting a tariff imposed by Puerto Rico on coffee imported into Puerto Rico. Requires the ITC to report to Congress and the President on the economic impact of this Act on U.S. industries and consumers during: (1) the two year period beginning with the enactment of this Act; and (2) each year afterwards, until duty-free treatment under this title is terminated. Sets forth those assessments. Directs the Secretary of Labor, in consultation with other appropriate Federal agencies, to report to Congress on the impact on labor of the implementation of this title. Directs the Secretary of State to prepare a study regarding the feasibility of establishing a Caribbean Trade Institute in New York City. Sets forth factors to be assessed in the study. Terminates duty-free treatment to beneficiary countries under this title after FY 1995. Subtitle B: Tax Provisions - Amends the Internal Revenue Code to require excise taxes on rum imported into the United States to be paid to Puerto Rico and the U.S. Virgin Islands. Allows an income tax deduction for expenses incurred in attending a convention in a beneficiary country named under the provisions of this Act (including Bermuda), if such country has a tax information agreement in effect with the United States and such country's tax laws not not discriminate against conventions held in the United States. Authorizes the Secretary of the Treasury to negotiate and conclude agreements with beneficiary countries for the exchange of tax information required to enforce the tax laws of the respective countries. Directs the Secretary to report to the Congress within 90 days of the enactment of this Act on: (1) the level at which Caribbean Basin tax havens are being used and the effect on Federal revenues of such use; (2) the relationship of such use to drug trafficking and other criminal activities; and (3) current Department of the Treasury enforcement activities against tax havens.

(Measure passed Senate, amended, roll call #157 (86-4)) Title I: Interest and Dividend Tax Compliance - Interest and Dividend Compliance Act of 1983 - Amends the Tax Equity and Fiscal Responsibility Act of 1982 to repeal, for taxable years beginning after 1982, withholding of tax requirements for interest and dividend income. Exempts a taxpayer who underpays his estimated tax in reliance upon the withholding requirement from the penalties for underpayment of tax if such taxpayer satisfies any pre-July 1983 underpayment of estimated tax before the due date of the next installment payment. Requires the Comptroller General to conduct a study to determine the percentage of compliance for the reporting of interest and dividends and to report such findings to the Congress not later than January 1, 1988. Provides for a system of backup withholding for taxpayers who underreport interest and dividend income or fail to provide accurate taxpayer information. Requires the payor of any amount of income to deduct and withhold 15 percent of such payment if the payee fails to provide a taxpayer identification number or provides an incorrect one. Requires the payor of interest and dividend income to withhold 20 percent of such amounts if such payor receives notice from the Internal Revenue Service (IRS) that his payee has underreported interest and dividend income or has not properly certified that he is exempt from a withholding requirement. Imposes upon payors of interest and dividend income a $100 fine for each failure to implement backup withholding when required. Imposes upon retail brokers a $500 fine for each failure to provide backup withholding information or taxpayer information numbers. Requires any payor of interest or dividend income who is required to file more than 50 information returns to file such returns on magnetic media. Requires the Secretary of the Treasury, in consultation with the Secretary of Health and Human Services, to conduct a study of the feasibility of requiring persons to file, on magnetic media, W-2 wage reports. Imposes a penalty for failure to provide a taxpayer identification number, or any statement or return, with respect to the reporting of interest and dividend income. Exempts a taxpayer from a penalty if he can show due diligence in attempting to satisfy the requirement. Makes such penalty self-assessable on the taxpayer's return as an excise tax. Requires payees of interest and dividend income to file a duplicate statement of such income with their income tax returns. Imposes a $50 fine for each failure to provide such duplicate unless the failure is due to reasonable cause and not willful neglect. Imposes a $1,000 fine on taxpayers who fail to include any amount of interest, dividends, or patronage dividends on a return when required to do so. Requires the Secretary of the Treasury to implement a program for the processing of interest and dividend information returns which will notify taxpayers within 15 1/2 months of the close of the calendar year of any disparities in the reporting of such income. Authorizes appropriations. Title II: Caribbean Basin Initiative - Caribbean Basin Economic Recovery Act - Subtitle A: Duty-Free Treatment - Authorizes the President to proclaim duty-free treatment for all eligible articles from Caribbean countries that the President designates as beneficiary countries. Requires the President to notify Congress before making such a designation. Prohibits the President from terminating such a designation unless both Houses of Congress are notified 60 days before the termination. Requires the President to consider only specified countries and territories as beneficiary countries. Prohibits the President from designating a country as a beneficiary country: (1) if it is a Communist country; (2) if it has nationalized or seized control, or effectively nationalized or seized control, of U.S. property, unless the President determines that a good faith effort is being made to compensate for such seizure; (3) if it fails to act in good faith in recognizing as binding or in enforcing arbitral awards in favor of U.S. citizens or corporations; (4) if it grants preferential treatment to the products of a developed country other than the United States which may have a significant adverse effect on U.S. commerce, unless the President reports to Congress that certain assurances have been made; (5) if it has a government-owned entity engaged in broadcasting copyrighted material belonging to U.S. copyright owners without their express consent; (6) if it does not take adequate steps to cooperate with the United States unlawfully; or (7) unless an extradition treaty exists between the United States and such country. and such country. Permits the President to designate as a beneficiary country a Communist country, an expropriating country, a country that fails to act in good faith with respect to an arbitral award, or a country which violates a copyright, if the President determines and reports to Congress that such designation will be in the national interest. Lists factors the President should consider in determining whether to grant beneficiary designation. Amends the Tariff Schedules of the United States to grant to imports from U.S. insular possessions, subject to specified provisions of this Act, duty treatment no less favorable than the treatment afforded such imports from a beneficiary country. Directs the President to withdraw or suspend a country's beneficiary designation, if the President determines that changed circumstances in such country would prohibit such designation under the guidelines in this title. Requires duty-free treatment to apply to any article imported from a beneficiary country, unless otherwise excluded from eligibility, if: (1) the article is imported directly from such country into U.S. customs territory; and (2) the sum of specified costs of the article is not less than 35 percent of its appraised value at the time of its entry. Directs the Secretary of the Treasury to prescribe regulations governing articles eligible for such duty-free treatment, including the requirement that such articles must be wholly the product of a beneficiary country or must be a new or different article of commerce which has been produced in the beneficiary country. Prohibits this duty-free treatment from applying to: (1) textile and apparel articles which are subject to tariff agreements; (2) certain footwear, handbags, luggage, flat goods, work gloves, and leather wearing apparel; (3) tuna prepared or preserved in airtight containers; (4) petroleum or certain petroleum products; and (5) watches and watch parts. Directs the President to suspend duty-free treatment of sugar and beef products that are the products of a beneficiary country if: (1) the beneficiary country, within 90 days of its designation as a beneficiary country, does not submit a Stable Food Production Plan to the President for evaluation; (2) the President determines that the Plan of a beneficiary country does not meet specified criteria; or (3) as a result of the monitoring of the operation of the Plan, the President determines that a beneficiary country is not making a good faith effort to implement its Plan, or that the Plan, although being implemented, is not achieving its purposes. Requires the President, before suspending such duty-free treatment, to offer to consult with the country to formulate appropriate remedial action. Requires the President, biennially, to monitor the operation of the Plans implemented by beneficiary countries and to report to Congress. Requires the President to terminate the suspension of duty-free treatment if the beneficiary country has acted to remedy the situation which caused the suspension. Sets forth the manner of governing the importation and duty-free treatment of certain sugars, sirups, and molasses. Authorizes the President to suspend the duty-free treatment provided by this title and to proclaim a duty for an eligible article if such action is taken pursuant to certain import relief or national security provisions. Requires the International Trade Commission (ITC), in any report on a petition for import relief under the Trade Act of 1974, to state how its findings and recommendations apply to any duty-free article imported from beneficiary countries. Authorizes the President to reduce or end the application of import relief measures which apply to articles imported from beneficiary countries earlier than otherwise scheduled. Requires the suspension of duty- free treatment provided by this title to be treated as an increase in duty for purposes of the import relief section of the Trade Act of 1974. Prohibits such a suspension of duty-free treatment unless the ITC finds that the harm caused by the imports results from its duty-free treatment by this title. Authorizes the filing of petitions for import relief with the Secretary of Agriculture (Secretary), as well as with the ITC, for injury from imports of perishable products from beneficiary countries. Directs the Secretary to recommend the granting or denying of such petition within 14 days of its filing. Requires the President to take emergency action or to publish a notice of determination not to take emergency action within seven days of receiving the Secretary's recommendation. Sets forth the limits on the duration of the emergency action. Defines perishable products to include certain live plants, certain fresh or chilled vegetables, fresh mushrooms, fresh fruit, fresh cut flowers, and concentrated citrus fruit juice. Exempts from proclamations under this title certain fees imposed pursuant to the Agricultural Adjustment Act. Provides for duty-free treatment of articles imported directly from Puerto Rico and the U.S. insular possessions, so long as foreign materials do not account for more than 70 percent of the total value of the articles (or more than 50 percent of the total value with respect to articles excluded from duty-free treatment under the Caribbean Basin Economic Recovery Act). Amends the Tariff Schedules of the United States to increase to five liters (currently, four liters) the amount of duty-free liquor that may be brought into the United States. Requires that not more than four liters of such five liter limit may have been produced outside American Samoa, Guam, or the U.S. Virgin Islands. Authorizes the President to withdraw duty-free treatment on rum if the amount of excise taxes on rum that is paid into the treasuries of Puerto Rico and the Virgin Islands falls below the amount that would have been paid if the rum had been produced in Puerto Rico or the Virgin Islands. Amends the Trade Agreements Act of 1979 to repeal the provision for protecting U.S. possessions against revenue losses caused by concessions granted by the United States in the Tokyo Round of the Multilateral Trade Negotiations. Prohibits any action under this title from affecting a tariff imposed by Puerto Rico on coffee imported into Puerto Rico. Exempts nontoxic rum stillage discharges in the Virgin Islands from certain provisions of the Water Pollution Control Act if the discharges are 1500 feet from the shore and are determined by the Virgin Islands Governor not to constitute a health or environmental hazard. Requires the ITC to report to Congress and the President on the economic impact of this Act on U.S. industries and consumers during: (1) the two year period beginning with the enactment of this Act; and (2) each year afterwards, until duty-free treatment under this title is terminated. Sets forth assessments that the ITC shall make and factors to be considered in making those assessments. Terminates duty-free treatment to beneficiary countries under this title after FY 1995. Subtitle B: Tax Provisions - Amends the Internal Revenue Code to require excise taxes on rum imported into the United States to be paid to Puerto Rico and the U.S. Virgin Islands. Allows an income tax deduction for expenses incurred in attending a convention in a beneficiary country named under the provisions of this Act (including Bermuda), if such country has a tax information agreement in effect with the United States and such country's tax laws do not discriminate against conventions held in the United States. Authorizes the Secretary of the Treasury to negotiate and conclude agreements with beneficiary countries for the exchange of tax information required to enforce the tax laws of the respective countries. Subtitle C: Sense of Congress Regarding Sugar Imports - Expresses the sense of the Congress that sugar from any Communist country in the Caribbean Basin or in Central America should not be imported into the United States. Title III: Enterprise Zone - Enterprise Zone Act of 1983 - Subtitle A: Designation of Enterprise Zones - Amends the Internal Revenue Code to provide for the designation of enterprise zones by the Secretary of Housing and Urban Development for purposes of extending the tax incentives and regulatory flexibility measures provided by this Act. Specifies that State and local governments shall nominate areas for such designation. Limits the designation of enterprise zones to 75 nominated areas per year (one-third of which must be in rural areas). Limits the period during which such designations shall remain in effect. Specifies that the Secretary may designate such zones only if: (1) the area is within the jurisdiction of the local government; (2) the boundary of the area is continuous; (3) the area has a population of at least 4,000 if any portion thereof is located within a standard metropolitan statistical area (within a population of at least 50,000) or 1,000 otherwise, or is within an Indian reservation; and (4) the area meets specified unemployment and poverty requirements. Requires nominating local governments, as a condition of the Secretary's designation, to agree in writing to follow a course of action which may include reducing tax rates, improving local services, simplifying or streamling regulation of business, or receiving commitments of private entities to assist employees and residents of the area. Terminates the authority of the Secretary to designate enterprise zones on October 1, 1986 or three years after the publication of regulations pertaining to such zones, whichever is later. Describes areas to which preference shall be given in deciding to designate enterprise zones. Requires the Secretary to prepare and submit to the Congress every four years a report on the effects of such enterprise zones' designation. Requires that any property tax reduction effected by a local government under the terms of this Act be disregarded for purposes of determining the eligibility of a State or local government for Federal assistance or benefits. States that designation of an enterprise zone shall not give displaced persons from such an area any rights or benefits under the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970. Exempts enterprise zones from certain requirements relating to Federal environmental policy. Subtitle B: Federal Income Tax Incentives - Part I: Credits for Employers and Employees - Allows employers located in enterprise zones a nonrefundable income tax credit for increased employment expenditures and employment of the disadvantaged. Allows a three year carryback and 15 year carryover of such credit. Sets the amount of such credit at ten percent of the increase in payroll (taking into account a maximum of $15,000 in wages per year per employee) plus 50 percent of the wages paid to certain disadvantaged workers for the first three years of the enterprise zone designation. Phases out such credit in the last three years of the enterprise zone designation. Requires the employer to furnish to the employee a statement showing the amount of wages qualifying for the enterprise zone credit. Part II: Credits for Investment in Tangible Property in Enterprise Zones - Allows businesses an additional investment tax credit for investment in certain tangible property located in enterprise zones. Limits such credit to five percent for zone personal property and ten percent for new zone construction property, including rental property. Requires that the property subject to such credit be predominantly used in the zone, be purchased after zone designation, and not be acquired from relatives or related corporations. Requires the recapture of such credit upon early disposition of the property. Phases out such credit in the last three years of the enterprise zone designation. Part III: Reduction in Capital Gain Tax Rates - Eliminates the capital gains tax on property of corporations acquired after the enterprise zone designation and used in a zone business. Qualifies certain low-income rental housing located in an enterprise zone for such treatment. Permits property to remain qualified for purposes of the revised capital gains treatment after a designation of an enterprise zone has terminated. Exempts gain from the sale or exchange of property used in a business in an enterprise zone from the computation of the minimum tax. Allows noncorporate taxpayers to deduct from gross income 100 percent of any net capital gain from qualified enterprise zone property. Part IV: Rules Relating to Industrial Development Bonds - Provides that limitations on the cost recovery deductions for property financed with tax-exempt industrial development bonds shall not apply to enterprise zone property. Provides that the termination of the small issue exemption shall not apply to industrial development bonds the proceeds of which are used to finance facilities in such enterprise zones. Part V: Sense of the Congress with Respect to Tax Simplification - Expresses the sense of the Congress that the Internal Revenue Service should simplify the administration and enforcement of any provision of the Internal Revenue Code affected by this Act. Subtitle C: Regulatory Flexibility - Revises the definition of "small entity" for purposes of the analysis of regulatory functions, to include qualified businesses to include governments, and nonprofit enterprises operating within enterprise zones. Authorizes Federal agencies, upon request by a designating government, to waive or modify rules and regulations which pertain to the carrying out of projects or activities within an enterprise zone. Requires agencies to approve such request if the resulting benefits of job creation, community development, or economic revitalization outweigh the public interest in continuation of the rule unchanged. Disallows waiver or modification of a rule that would directly violate a statutory requirement (including the Davis-Bacon Act and Fair Labor Standards Act) or which would present a danger to the public health and safety. Provides that such waivers or modifications of a rule shall remain in effect as long as the zone designations. Amends the Department of Housing and Urban Development Act to direct the Secretary of Housing and Urban Development to promote the coordination of all enterprise zone programs and consolidate all periodic reports required under such programs into one summary report. Subtitle D: Establishment of Foreign-Trade Zones in Enterprise Zones - Requires the Foreign-Trade Board to consider on a priority basis and expedite the processing of applications for the establishment of foreign-trade zones within enterprise zones. Requires the Secretary of the Treasury to give priority to, and expedite applications for, the establishement of ports of entry necessary to establish such zones. States that to the maximum extent practicable foreign-trade zones should be established within enterprise zones. Title IV: Trade Act of 1974 Amendments - International Trade and Investment Act - Amends the Trade Act of 1974 to set forth provisions dealing with foreign trade barriers. Directs the United States Trade Representative (USTR), through the interagency trade organization established pursuant to the Trade Expansion Act of 1962, to identify, analyze, and estimate the impact of practices that constitute significant barriers to or distortions of: (1) U.S. export of goods or services; and (2) foreign direct investment by U.S. persons, especially if it has implications for trade in goods or services. Sets forth factors to be considered by the USTR in such analysis. Directs the USTR to update the analysis annually. Directs the USTR to submit the analysis to the appropriate congressional committees. Requires the report to include any action taken to eliminate such trade barriers, including presidential action in the case of unfair trade practices and negotiations or consultations with foreign governments. Directs the USTR to consult with Congress on trade policy priorities. Directs Federal agencies to furnish information and other assistance to prepare such analysis. Authorizes the President to respond to a foreign entity's unfair trade practices by taking action with respect to any goods or sector of such entity without regard to whether the goods or sector were involved in the unfair trade practice. (Current law provides that the President may take action against the products or services of the foreign entity.) Authorizes the President to propose legislation to protect U.S. trade rights or to eliminate unfair trade practices. Requires such legislative proposals to be given priority treatment. Requires a summary of a petition for a trade investigation by the USTR to be published in the Federal Register (currently, the entire petition must be published) if the USTR decides to begin an investigation with respect to the issues raised by the petition. Authorizes the USTR to initiate an investigation in order to advise the President concerning the exercise of the President's authority to take action against unfair trade practices. Directs the USTR to consult with the appropriate congressional committees before beginning such an investigation. Authorizes the USTR to delay for up to 90 days any request for consultation by a foreign entity concerning a petition for investigation into unfair trade practices. Directs the USTR to publish notice of the delay in the Federal Register and to report to Congress the reasons for the delay. Changes the definition of "commerce" for purposes of foreign trade investigations to include: (1) services associated with international trade, whether or not related to specific goods (currently products); and (2) foreign direct investment by U.S. persons with implications for trade in goods or services. Defines "unreasonable", "unjustifiable", and "discriminatory" for purposes of such investigations. Prohibits making information which the USTR has received in a trade investigation available to the public, if: (1) the person who provided the information makes a specified certification; (2) the USTR determines that such certification is well-founded; and (3) the person providing the information provides an adequate nonconfidential summary. Authorizes the USTR to use the information in trade investigations or to make it available to the public in a form which cannot identify the person providing the information. Sets forth the principal U.S. negotiating objectives with respect to trade in services, foreign direct investment, and high technology products. Directs the USTR to develop and coordinate the implementation of U.S. policies concerning trade in services. Requires Federal agencies responsible for regulating any service sector industry to advise and work with the USTR concerning: (1) the treatment afforded U.S. services sector interest in foreign markets; or (2) allegations of unfair practices by foreign governments or companies in a service sector. Authorizes the Secretary of Commerce to establish a service industries development program. Sets forth the goals of the program. Expresses the policy of the Congress that the President shall: (1) consult with State governments on trade policy issues affecting the regulatory authority on non-Federal governments or their procurement of goods and services; and (2) establish one or more intergovernmental policy advisory committees on trade. Authorizes the President to establish policy advisory committees representing non-Federal governmental interests to provide policy advice on trade negotiating objectives, bargaining positions, and the implementation of trade agreements. Authorizes the President to negotiate to reduce trade barriers in foreign direct investment by U.S. persons, especially if such investment has implications for trade in goods and services. Authorizes the President to enter into agreements concerning high technology industries. Authorizes the President to proclaim the modification, elimination or continuance of any existing duty, duty-free, excise treatment, or other additional duties with respect to specified high technology products listed in the U.S. Tariff Schedules. Provides for the termination of this authority five years after the enactment of this Act. Expresses the sense of Congress that the Secretary of Agriculture should request the President to call for an International Trade Commission investigation of honey imports. Title V: Mortgage Subsidy Bonds - Amends the Internal Revenue Code to make permanent the tax exclusion for interest on qualified mortgage bonds. Excludes from gross income, for income tax purposes, any discharge of residential mortgage indebtedness which occurred in calendar year 1982. Limits the amount excludible to the adjusted basis of the taxpayer in the principal residence with respect to which the mortgage indebtedness was incurred. Reduces the basis of the principal residence by the amount of any discharge of mortgage indebtedness. Treats any gain recognized from the disposition of a principal residence as ordinary income to the extent such gain does not exceed the amount of the reduction in basis. Suspends the application of Revenue Ruling 82-202 for calendar years 1983 and 1984, (holding that income is realized on the discharge of indebtedness by prepayment of a mortgage balance at a discount). Expresses the sense of the Congress that legislation be enacted wich addresses the Federal income tax consequences of discharge of residential mortgage indebtedness that result from prepayment of such indebtedness and which applies to discharge of mortgage indebtedness that occurs after December 31, 1982.

Amends the Tax Equity and Fiscal Responsibility Act of 1982 to repeal the provisions which require the withholding of tax on interest and dividends. Makes technical amendments to insure that taxpayers who anticipated the ten percent withholding provision becoming effective on July 1, 1983, do not suffer estimated tax penalties for underpayment of tax for the period between January and June 1983.