26 U.S.C. § 2108 — Application of pre-1967 estate tax provisions

(a) Imposition of more burdensome tax by foreign country. If the President finds a foreign country taxes U.S. citizens' estates more heavily than the U.S. taxes that country's residents, the President may act. The President must also find that the country refused U.S. requests to fix this imbalance, and that applying older rules serves the public interest. If all three findings are made, the President may apply pre-1967 tax rules to that country's residents who die after the proclamation. Those older rules ignore later amendments to sections 2101, 2102, 2106, and 6018. (b) Alleviation of more burdensome tax. If the President later finds the foreign country's laws are no longer more burdensome, the President may end the special treatment. After that proclamation, estates of residents who die later return to the normal, current tax rules. (c) Notification of Congress required. The President cannot issue either proclamation without first notifying the Senate and House of Representatives. That notice must come at least 30 days before the proclamation. (d) Implementation by regulations. The Secretary must write regulations as needed to carry out this section.

The record. According to the source credit, this section was added by Public Law 89-809, title I, § 108(f), enacted November 13, 1966, and appearing at 80 Stat. 1573. The credit reflects one subsequent amendment, made by Public Law 94-455, title XIX, §§ 1902(a)(6) and 1906(b)(13)(A), enacted October 4, 1976, affecting 90 Stat. 1805 and 1834. Beyond these two legislative actions, the source credit does not indicate further amendment activity. Historical context. Public Law 89-809 is generally understood to be the Foreign Investors Tax Act of 1966, a statute commonly associated with revising the U.S. tax treatment of foreign persons' income and of the U.S. estates of nonresident aliens. Section 2108's reciprocity mechanism—authorizing the President to reinstate older, pre-1967 estate tax rules toward a foreign country found to impose disproportionately burdensome estate taxes on U.S. citizens—fits the broader pattern of that era's tax legislation, which often sought to encourage foreign governments to extend treatment to U.S. persons comparable to what the U.S. extended to their nationals. This reading is consistent with the section's structure, which conditions relief on presidential findings, diplomatic outreach, and congressional notification. The record does not, however, establish the specific legislative deliberations, foreign-country disputes, or committee rationale that led Congress to include this particular reciprocity provision in the 1966 Act, nor does it document why the 1976 amendments were made. Any more detailed account of legislative intent beyond this general historical understanding would be speculative.