A bill to amend the Internal Revenue Code of 1986 to retain a capital gains tax differential, and for other purposes.

Amends the Tax Reform Act of 1986 to repeal provisions relating to the taxation of capital gains. Provides that the Internal Revenue Code shall be applied and administered as if such provisions had not been enacted.

Amends the Internal Revenue Code to revise the method of calculating the deduction for capital gains. Allows a capital gains deduction of 60 percent for assets held three years or more, and 40 percent for assets held for more than one but less than three years.