11(b) is amended to read as follows: (b) Amount of tax The amount of the tax imposed by subsection (a) shall be 15 percent of taxable income. . (b) Conforming amendments Paragraphs (1), (2), and (6) of section 1445(e) are each amended by striking 35 percent and inserting 15 percent . (c) Effective date (1) In general Except as otherwise provided in this subsection, the amendments made by this section shall apply to taxable years beginning after December 31, 2016. (2) Certain conforming amendments The amendments made by subsection (b) shall apply to transfers, dispositions, and distributions, after such date. 202. Reduced rate on other business income (a) In general Section 1 is amended by adding at the end the following new subsection: (j) Maximum rate on business income (1) In general The rate of tax imposed under this section on business income shall not exceed 15 percent. (2) Business income The term business income means the excess (if any) of— (A) any distributional or pro rata share of items of income or gain from a partnership or S corporation and any income or gain properly allocable to a sole proprietorship, over (B) any distributional or pro rata share of items of deduction or loss from a partnership or S corporation and any deduction or loss properly allocable to a sole proprietorship. . (b) Effective date The amendment made by this section shall apply to taxable years beginning after December 31, 2016. III Exemption system for taxation of foreign income 301. Deduction for dividends received by domestic corporations from certain foreign corporations (a) In general Part VIII of subchapter B of chapter 1 is amended by inserting after section 245 the following new section: 245A. Dividends received by domestic corporations from certain foreign corporations (a) In general In the case of any dividend received from a specified 10-percent owned foreign corporation by a domestic corporation which is a United States shareholder with respect to such foreign corporation, there shall be allowed as a deduction an