S. 743Senate117th Congress (2021-2023)In Committee

State Fiscal Flexibility Act of 2021

Sponsored by Mike CrapoSen. Mike Crapo (R-ID)
Introduced March 15, 2021

AI-Generated Summary

Updated February 8, 2026 at 12:22 AM UTC

The State Fiscal Flexibility Act of 2021 changes the Social Security Act to let states and U.S. territories lower their tax rates. It also modifies the rules for using coronavirus recovery funds, barring those funds from being deposited into pension accounts and updating related language. The changes affect state and territorial governments that receive these federal funds.

Key Provisions

  • Removes the existing ban that prevents states and territories from reducing their taxes.
  • Specifies that coronavirus recovery funds cannot be deposited into any pension fund.
  • Updates related sections of the Social Security Act to reflect the removal of the tax‑lowering prohibition and the new pension‑fund restriction.

Legislative Activity

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1 earlier action
SenateIntro Referral Latest Action

Read twice and referred to the Committee on Finance.

March 15, 2021

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SenateIntro Referral

Introduced in Senate

March 15, 2021

SenateIntro Referral

Read twice and referred to the Committee on Finance.

March 15, 2021

Floor Debate

1 member

What members said about S. 743 on the floor

1 Republican
Diana Harshbarger
Rep. Diana HarshbargerR-TN-1 · Oct 20, 2021

Madam Speaker, I rise to recognize the life and service of Mr. Loy A. Ownby of Sevierville, Tennessee. Loy was born on August 9, 1920 and passed away on February 5, 2004. He was a highly decorated…

Bill Text

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Introduced in SenateIssued March 15, 2021

II

117th CONGRESS

1st Session

S. 743

IN THE SENATE OF THE UNITED STATES

March 15, 2021

Mr. Crapo (for himself, Mr. Grassley, Mr. Cornyn, Mr. Portman, Mr. Scott of South Carolina, Mr. Lankford, Mr. Daines, Mr. Young, Mr. Risch, and Mr. Thune) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend title VI of the Social Security Act to remove the prohibition on States and territories against lowering their taxes.

1.

Short title

This Act may be cited as the State Fiscal Flexibility Act of 2021.

2.

Removal of restriction of use of Coronavirus State Fiscal Recovery funds

(a)

In general

Paragraph (2) of section 602(c) of the Social Security Act, as added by section 9901 of the American Rescue Plan Act of 2021, is amended to read as follows:

(2)

Further restriction on use of funds

No State or territory may use funds made available under this section for deposit into any pension fund.

.

(b)

Conforming amendments

Section 602 of such Act is further amended—

(1)

in subsection (d)(2)(A), by striking , including, in the case of a State or a territory, all modifications to the State's or territory's tax revenue sources during the covered period;

(2)

in subsection (e), by striking such subsection, and all that follows through the period and inserting such subsection.; and

(3)

in subsection (g)—

(A)

by striking paragraph (1); and

(B)

by redesignating paragraphs (2) through (7) as paragraphs (1) through (6), respectively.

(c)

Effective date

The amendments made by this section shall take effect as if included in the enactment of the American Rescue Plan Act of 2021.