Disclosure of Tax Havens and Offshoring Act
This bill requires certain members of a multinational enterprise group that are also issuers of securities to annually disclose information related to the tax jurisdiction, income, and assets of their constituent entities on a country-by-country basis. (Multinational enterprise groups have two or more entities with different tax jurisdictions.)
[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4938 Introduced in House (IH)]
<DOC>
118th CONGRESS
1st Session
H. R. 4938
To amend the Securities Act of 1934 to require country-by-country
reporting.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 26, 2023
Ms. Pettersen introduced the following bill; which was referred to the
Committee on Financial Services
_______________________________________________________________________
A BILL
To amend the Securities Act of 1934 to require country-by-country
reporting.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Disclosure of Tax Havens and
Offshoring Act''.
SEC. 2. COUNTRY-BY-COUNTRY REPORTING.
(a) Country-by-Country Reporting.--Section 13 of the Securities
Exchange Act of 1934 (15 U.S.C. 78m) is amended by adding at the end
the following new subsection:
``(t) Disclosure of Financial Performance on a Country-by-Country
Basis.--
``(1) Definitions.--In this subsection--
``(A) the term `constituent entity' means, with
respect to a covered issuer, any separate business
entity of the covered issuer;
``(B) the term `covered issuer' means an issuer
who--
``(i) is a member of a multinational
enterprise group; and
``(ii) the multinational enterprise group
of which the issuer is a member has annual
revenue for the preceding calendar year of not
less than an amount determined by the
Commission to conform to United States or
international standards for country-by-country
reporting; and
``(C) the term `tax jurisdiction'--
``(i) means a country or a jurisdiction
that is not a country but that has fiscal
autonomy; and
``(ii) includes a territory or possession
of the United States that has fiscal autonomy.
``(2) Disclosure.--
``(A) In general.--Each covered issuer shall file a
report with the Commission that includes information
described in subparagraph (B), and any other
information required by the Commission, with respect to
the reporting period described in subparagraph (C).
``(B) Information required.--The information
described in this subparagraph is as follows:
``(i) Constituent entity information.--
Information on the constituent entity,
including the following:
``(I) The complete legal name of
the constituent entity.
``(II) The tax jurisdiction, if
any, in which the constituent entity is
resident for tax purposes.
``(III) The tax jurisdiction in
which the constituent entity is
organized or incorporated (if different
from the tax jurisdiction of
residence).
``(IV) The tax identification
number, if any, used for the
constituent entity by the tax
administration of the constituent
entity's tax jurisdiction of residence.
``(V) The main business activity or
activities of the constituent entity.
``(ii) Tax jurisdiction.--Information on
each tax jurisdiction in which one or more
constituent entities is resident, presented as
an aggregated or consolidated form of the
information for the constituent entities
resident in each tax jurisdiction, including
the following:
``(I) Revenues generated from
transactions with other constituent
entities.
``(II) Revenues not generated from
transactions with other constituent
entities.
``(III) Profit or loss before
income tax.
``(IV) Total income tax paid on a
cash basis to all tax jurisdictions.
``(V) Total accrued tax expense
recorded on taxable profits or losses.
``(VI) Stated capital.
``(VII) Total accumulated earnings.
``(VIII) Total number of employees
on a full-time equivalent basis.
``(IX) Net book value of tangible
assets, which, for purposes of this
section, does not include cash or cash
equivalents, intangibles, or financial
assets.
``(iii) Special rules.--The information
listed in clause (ii) shall be provided, in
aggregated or consolidated form, for any
constituent entity or entities that have no tax
jurisdiction of residence. In addition, if a
constituent entity is an owner of a constituent
entity that does not have a jurisdiction of tax
residence, then the owner's share of such
entity's revenues and profits will be
aggregated or consolidated with the information
for the owner's tax jurisdiction of residence.
``(C) Reporting period.--The reporting period
covered by this paragraph is the period of the covered
entity's applicable financial statement prepared for
the 12-month period that ends with or within the
taxable year of the covered issuer. If the covered
issuer does not prepare an annual applicable financial
statement, then the reporting period covered by this
paragraph is the 12-month period that ends on the last
day of the taxable year of the covered issuer.
``(D) Filing deadline.--Each covered issuer shall
submit to the Commission a report required under this
section on or before the due date (including
extensions) for filing that covered issuer's tax return
in the tax jurisdiction in which the covered issuer's
multinational enterprise group is resident.
``(E) Regulation.--The Commission shall, in
consultation with the Commissioner of the Internal
Revenue Service and Secretary of the Treasury--
``(i) promulgate regulations carrying out
this subsection that conform to United States
or international standards for country-by-
country reporting, including regulations
promulgated by the Internal Revenue Service;
and
``(ii) require disclosure of the accounting
methods used in calculating the information
contained in each report filed pursuant to this
subsection.''.
(b) Rulemaking.--
(1) Deadlines.--The Securities and Exchange Commission (in
this section referred to as the ``Commission'') shall--
(A) not later than 1 year after the date of
enactment of this Act, issue a proposed rule to carry
out this section and the amendment made by this
section; and
(B) not later than 18 months after the date of
enactment of this Act, issue a final rule to carry out
this section and the amendment made by this section.
(2) Data format.--The information required to be provided
by this section shall be provided by the issuer in a report in
a machine readable format prescribed by the Commission, and
such report shall be made available to the public online, in
such machine readable format as the Commission shall prescribe.
(3) Effective date.--Subsection (t) of section 13 of the
Securities Exchange Act of 1934, as added by this section,
shall become effective 1 year after the date on which the
Commission issues a final rule under this section.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Financial Services.
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