,,ii #aaith ,,congress #ast ,session ,s4 #bigf ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,october #f1 #bjbe,mr4 ,moreno introduced the following bill2 which was read twice and referred to the ,committee on ,finance ,a ,,bill ,to amend the ,internal ,revenue ,code of #aihf to impose an excise tax on payments by ,united ,states taxpayers to foreign persons for services provided to ,united ,states consumers1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,halting ,international ,relocation of ,employment ,act or the ,,hire ,act4 #b4 ,outsourcing excise tax 7a7 ,in general ,subtitle ,d of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new chapter3 #ej;,b ,outsourcing ,sec4 #ejjj;,e4 ,outsourcing payments4 #ejjj;,e4 ,outsourcing payments 7a7 ,imposition of tax ,there is hereby imposed a tax on any ,united ,states person making an outsourcing payment a tax equal to #be percent of the amount of such payment4 7b7 ,outsourcing payment ,for purposes of this section-- 7#a7 ,in general ,the term outsourcing payment means any premium1 fee1 royalty1 service charge1 or other payment made-- 7,a7 in the course of a trade or business1 7,b7 to a foreign person1 and 7,c7 with respect to labor or services the benefit of which is directed1 directly or indirectly1 to consumers located in the ,united ,states4 7#b7 ,mixed payments ,in the case of any payment to a foreign person with respect to which labor or services are directed to consumers both within and without the ,united ,states1 the amount treated as an outsourcing payment shall not exceed the amount equal to the product of such payment and a fraction-- 7,a7 the numerator of which is the amount of labor or services with respect to such payment directed to consumers within the ,united ,states1 to 7,b7 the labor or services with respect to such payment directed to all consumers4 7c7 ,foreign person ,for purposes of this section1 the term foreign person means any person who is not a ,united ,states person1 except that such term shall not include any corporation or partnership which is organized under the laws of a possession of the ,united ,states4 7d7 ,regulations and other guidance ,the ,secretary shall prescribe such regulations and other guidance as may be necessary or appropriate to carry out this section1 including regulations or guidance to prevent the avoidance or abuse of the purposes of this section1 including through the use of related parties1 controlled foreign corporations1 and other intermediaries1 or through the use of transfer pricing arrangements4 4 7b7 ,tax not deductible ,section #bge7;a77#f7 of the ,internal ,revenue ,code of #aihf is amended by inserting #ej;,b1 after #ej;,a4 7c7 ,reporting ,the ,secretary of the ,treasury1 or the ,secretary's delegate1 may-- 7#a7 require ,united ,states persons making payments to foreign persons 7as defined in section #ejjj;,e of the ,internal ,revenue ,code of #aihf1 as added by subsection 7a77 to file a return of tax under section #ejjj;,e of such ,code or to file an information return concerning such payments1 which may include-- 7,a7 information on whether such payments are outsourcing payments 7as defined in section #ejjj;,e of such ,code71 and 7,b7 such other information concerning such payment as the ,secretary may reasonably require to enforce the amendments made by this section1 and 7#b7 require the officers of any corporation to certify on such return1 under penalty of perjury1 the character of such payments4 ,for purposes part ,,ii of subchapter ,b of chapter #fh of the ,internal ,revenue ,code of #aihf1 any return required to be filed under paragraph 7#a7 shall be treated as an information return4 7d7 ,increased penalty for failure ,to pay tax ,section #ffea7;a7 of the ,internal ,revenue ,code is amended by adding at the end the following new sentence3 ,in the case of the failure to pay any tax imposed under chapter #ej;,b1 paragraphs 7#b7 and 7#c7 shall be applied by substituting #ej percent for #je4 percent each place it appears and without regard to the phrase not exceeding #be percent in the aggregate each place it appears44 7e7 ,no inference ,nothing in this section or the amendments made by this section shall be construed to limit the application of the economic substance doctrine with respect to any payment described in section #ejjj;,e7b7 of the ,internal ,revenue ,code of #aihf1 as added by subsection 7a74 7f7 ,clerical amendment ,the table of chapters for subpart ,d of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new item3 ,chapter #ej;,b--,outsourcing 4 7g7 ,effective date ,the amendments made by this section shall apply to payments made after ,december #ca1 #bjbe4 #c4 ,domestic workforce fund 7a7 ,in general ,subchapter ,a of chapter #ih of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new section3 #ieab4 ,domestic workforce fund 7a7 ,establishment ,there is established in the ,treasury of the ,united ,states a trust fund to be known as the ,domestic ,workforce ,fund 7hereafter in this section referred to as the ,fund71 consisting of such amounts as may be appropriated1 credited1 or paid into the ,fund as provided in this section or section #ifjb7;b74 7b7 ,transfer to fund ,there are hereby appropriated to the ,fund amounts equivalent to the amounts received in the ,treasury under-- 7#a7 the tax imposed under section #ejjj;,e1 7#b7 so much of the additions to tax under section #fjea7;a7 as relates to the failure to pay taxes imposed under section #ejjj;,e1 and 7#c7 so much of the penalties imposed under part ,,ii of suchchapter ,b of chapter #fh as relates to returns described in section #b7;b7 of the ,halting ,international ,relocation of ,employment ,act4 7c7 ,expenditures from fund ,amounts in the ,fund shall be available1 without further appropriation1 solely for the following purposes3 7#a7 ,workforce development and retraining programs administered by the ,department of ,labor4 7#b7 ,apprenticeship programs and partnerships with industry to expand domestic employment in sectors impacted by outsourcing4 7#c7 ,grants to ,states for workforce development initiatives targeted at communities with high levels of job displacement4 4 7b7 ,clerical amendment ,the table of sections for subchapter ,a of chapter #ih of such ,code is amended by adding at the end the following new item3 ,sec4 #ieab4 ,domestic workforce fund4 4 #d4 ,denial of income tax deduction on outsourcing payments 7a7 ,in general ,part ,,ix of subchapter ,b of chapter #a of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new section3 #bhj;,i4 ,outsourcing payments ,no deduction shall be allowed under this chapter for any outsourcing payment 7as defined in section #ejjj;,e7b774 4 7b7 ,clerical amendment ,the table of section for part ,,ix of subchapter ,b of chapter #a of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new item3 ,sec4 #bhj;,i4 ,outsourcing payments4 4 7c7 ,effective date ,the amendments made by this section shall apply to payments made after ,december #ca1 #bjbe1 in taxable years ending after such date4