Taxpayer Bill of Rights  

II. Explanation of the Bill

Title V. Revenue Offsets
F. Add Vaccines Against Rotavirus Gastroenteritis
to the List of Taxable Vaccines

(Sec. 5006 of the Bill and Sec. 4132 of the Code)

Present Law

A manufacturer's excise tax is imposed at the rate of 75 cents per dose (Sec. 4131) on the following vaccines routinely recommended for administration to children: diphtheria, pertussis, tetanus, measles, mumps, rubella, polio, HIB (haemophilus influenza type B), hepatitis B, and varicella (chicken pox). The tax applied to any vaccine that is a combination of vaccine components equals 75 cents times the number of components in the combined vaccine.

Amounts equal to net revenues from this excise tax are deposited in the Vaccine Injury Compensation Trust Fund to finance compensation awards under the Federal Vaccine Injury Compensation Program for individuals who suffer certain injuries following administration of the taxable vaccines. This program provides a substitute Federal, "no fault" insurance system for the State-law tort and private liability insurance systems otherwise applicable to vaccine manufacturers. All persons immunized after September 30, 1988, with covered vaccines must pursue compensation under this Federal program before bringing civil tort actions under State law.

Reasons for Change

Rotavirus gastroenteritis is a highly contagious disease among young children that can lead to life-threatening diarrhea, cramps, vomiting, and can result in death. In the United States, more than 50,000 children are hospitalized and more than 100 die annually from rotavirus gastroenteritis. The Food and Drug Administration's ("FDA") advisory committee has favorably reviewed a vaccine against the disease and the Centers for Disease Control have voted to recommend the vaccine for inoculation of children, subject to final FDA approval. The Committee believes American children will benefit from wide use of this new vaccine. The Committee believes that, by including the new vaccine with those presently covered by the Vaccine Injury Compensation Trust Fund, greater application of the vaccine will be promoted. The Committee, therefore, believes it is appropriate to add the vaccine against rotavirus gastroenteritis to the list of taxable vaccines.

Explanation of Provision

The bill adds any vaccine against rotavirus gastroenteritis to the list of taxable vaccines.

Effective Date

The provision is effective for vaccines sold by a manufacturer or importer after the date of enactment. For sales on or before the date of enactment for which delivery is made after the date of enactment, the delivery date is deemed to be the sale date.

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