A bill to reduce the Federal deficit by imposing temporary surtaxes.

Amends the Internal Revenue Code to impose a one percent surtax on all individual gross income and on corporate gross sales for firms reporting more than one billion dollars in sales. Exempts individuals eligible for the credit for the elderly and permanently disabled and the earned income credit. Provides that the surtax will not apply after 1987. Provides that the surtax will not be treated as tax for purposes of the alternative minimum tax. Calculates the gross receipts of foreign corporations subject to the surtax by taking into account only gross receipts effectively connected with the conduct of a trade or business within the United States.

Establishes within the Treasury the Deficit Reduction Trust Fund. Transfers amounts received from the individual and corporate surtax to the Deficit Reduction Trust Fund.

Requires an annual report to the Congress by the Congressional Budget Office stating: (1) the amount of the revenue raised by these surtaxes; and (2) the impact of such surtaxes.