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.