To amend the Internal Revenue Code of 1986 to provide a temporary reduction in the maximum capital gains rate from 20 percent to 15 percent.

Amends the Internal Revenue Code and the Merchant Marine Act, 1936 to reduce the capital gains rate from 20 percent to 15 percent for sales or exchanges made on or after June 1, 2001, and in taxable years beginning before January 1, 2004. Prescribes a transition formula for taxable years including June 1, 2001.