text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Tax Equity Act of 1993''.
  
  SEC. 2. REGIONAL COST-OF-LIVING ADJUSTMENTS IN INDIVIDUAL INCOME TAX 
                RATES.
  
      (a) General Rule.--Subsection (f) of section 1 of the Internal 
  Revenue Code of 1986 (relating to adjustments in tax tables so that 
  inflation will not result in tax increases) is amended by adding at the 
  end thereof the following new paragraphs:
              ``(8) Regional cost-of-living adjustments.--
                      ``(A) In general.--In the case of an individual, 
                  the rate table otherwise in effect under this section 
                  for any taxable year (determined after the application 
                  of paragraph (1)) shall be further adjusted as provided 
                  in subparagraph (B).
                      ``(B) Method of making regional adjustment.--The 
                  rate table otherwise in effect under this section with 
                  respect to any individual for any taxable year shall be 
                  adjusted as follows:
                              ``(i) The minimum and maximum dollar 
                          amounts otherwise in effect for each rate 
                          bracket shall be multiplied by the applicable 
                          multiplier (for the calendar year in which the 
                          taxable year begins) which applies to the 
                          statistical area in which the individual's 
                          primary place of abode during the taxable year 
                          is located.
                              ``(ii) The rate applicable to any rate 
                          bracket (as adjusted by clause (i)) shall not 
                          be changed.
                              ``(iii) The amount setting forth the tax 
                          shall be adjusted to the extent necessary to 
                          reflect the adjustments in the rate brackets.
                  If any amount determined under clause (i) is not a 
                  multiple of $50, such amount shall be rounded to the 
                  nearest multiple of $50.
              ``(9) Determination of multipliers.--
                      ``(A) In general.--Not later than December 15 of 
                  each calendar year, the Secretary shall prescribe an 
                  applicable multiplier for each statistical area of the 
                  United States which shall apply to taxable years 
                  beginning during the succeeding calendar year.
                      ``(B) Determination of multipliers.--
                              ``(i) For each statistical area where the 
                          cost-of-living differential for any calendar 
                          year is greater than 125 percent, the 
                          applicable multiplier for such calendar year is 
                          90 percent of such differential.
                              ``(ii) For each statistical area where the 
                          cost-of-living differential for any calendar 
                          year exceeds 97 percent but does not exceed 125 
                          percent, the applicable multiplier for such 
                          calendar year is 1.05.
                              (iii) For each statistical area not 
                          described in clause (i) or (ii), the applicable 
                          multiplier is the cost-of-living differential 
                          for the calendar year.
                      ``(C) Cost-of-living differential.--The cost-of-
                  living differential for any statistical area for any 
                  calendar year is the percentage determined by 
                  dividing--
                              ``(i) the cost-of-living for such area for 
                          the preceding calendar year; by
                              ``(ii) the average cost-of-living for the 
                          United States for the preceding calendar year.
                      ``(D) Cost-of-living for area.--
                              ``(i) In general.--For each calendar year 
                          beginning after 1993, the Secretary of Labor 
                          shall determine and publish a cost-of-living 
                          index for each statistical area.
                              ``(ii) Methodology.--The cost-of-living 
                          index determined under clause (i) for any 
                          statistical area for any calendar year shall be 
                          based on average market prices for the area for 
                          the 12-month period ending on August 31 of such 
                          calendar year. The market prices taken into 
                          account under the preceding sentence shall be 
                          selected and used under the same methodology as 
                          is used by the Secretary of Labor in developing 
                          the Consumer Price Index for All Urban 
                          Consumers.
                      ``(E) Statistical area.--For purposes of this 
                  subsection the term `statistical area' means
                              ``(i) any metropolitan statistical area as 
                          defined by the Secretary of Commerce, and
                              ``(ii) the portion of any State not within 
                          a metropolitan statistical area as so defined.
              ``(10) Areas outside the united states.--The area 
          applicable multiplier for any area outside the United States 
          shall be 1.''
      (b) Effective Date.--
              (1) In general.--The amendment made by this section shall 
          apply to taxable years beginning after December 31, 1993.
              (2) Transition rule.--Notwithstanding section 1(f)(9)(A) of 
          the Internal Revenue Code (as added by this section), the date 
          for prescribing applicable multipliers for taxable years 
          beginning in calendar year 1994 shall be the date 1 year after 
          the date of the enactment of this Act.
target: Tax Equity Act of 1993 - Amends the Internal Revenue Code to provide for regional cost-of-living adjustments in individual income tax rates.
feat_title: Tax Equity Act of 1993