Legislative Document No. 403 H.P. 312 House of Representatives, January 29, 2019
An Act To Prevent Tax Haven Abuse
Reference to the Committee on Taxation suggested and ordered printed.
ROBERT B. HUNT Clerk
Presented by Representative TIPPING of Orono. Cosponsored by President JACKSON of Aroostook and Representatives: CUDDY of Winterport, GATTINE of Westbrook, MOONEN of Portland, PIERCE of Falmouth, TEPLER of Topsham, Senators: BREEN of Cumberland, LIBBY of Androscoggin.
Printed on recycled paper 1 Be it enacted by the People of the State of Maine as follows:
2 Sec. 1. 36 MRSA §5200, sub-§5, as enacted by PL 2005, c. 457, Pt. FFF, §1 and 3 affected by §2, is repealed and the following enacted in its place:
4 5. Net income. For purposes of this section, "net income" means for any taxable 5 year the total of the following as modified by section 5200-A: 6 A. The taxable income of the taxpayer for that taxable year under the laws of the 7 United States; and 8 B. The taxable income or loss of any corporation that is a member of a unitary group 9 and that is incorporated in any of the following jurisdictions: the Principality of 10 Andorra, Anguilla, Antigua and Barbuda, Aruba, the Commonwealth of the 11 Bahamas, the Kingdom of Bahrain, Barbados, Belize, Bermuda, the British Virgin 12 Islands, the Cayman Islands, the Cook Islands, the Republic of Cyprus, the 13 Commonwealth of Dominica, Gibraltar, Grenada, the Bailiwick of Guernsey, the Isle 14 of Man, the Bailiwick of Jersey, the Republic of Liberia, the Principality of 15 Liechtenstein, the Grand Duchy of Luxembourg, the Republic of Malta, the Republic 16 of the Marshall Islands, the Republic of Mauritius, the Principality of Monaco, 17 Montserrat, the Republic of Nauru, the Caribbean Netherlands, Niue, the Independent 18 State of Samoa, the Republic of San Marino, the Republic of Seychelles, the 19 Federation of St. Christopher and Nevis, St. Lucia, St. Vincent and the Grenadines, 20 the Turks and Caicos Islands, the United States Virgin Islands and the Republic of 21 Vanuatu. 22 The State Tax Assessor shall review annually the list of jurisdictions in paragraph B and 23 report to the joint standing committee of the Legislature having jurisdiction over taxation 24 matters whether any jurisdictions should be added to or deleted from the list based on 25 whether the jurisdiction taxes no or only nominal income, the jurisdiction lacks effective 26 exchange of information with other taxing authorities, the jurisdiction lacks governmental 27 transparency and the jurisdiction protects business with no substantial activity. 28 Sec. 2. Rules. The State Tax Assessor shall adopt rules to determine the income or 29 loss for a corporation that is a member of a unitary group that is not otherwise required to 30 file a consolidated federal return and to prevent double taxation or double deduction of 31 any amount included in the computation of net income under the Maine Revised Statutes, 32 Title 36, section 5200, subsection 5. Rules adopted pursuant to this section are major 33 substantive rules as described in Title 5, chapter 375, subchapter 2-A.
34 Sec. 3. Application. This Act applies to tax years beginning on or after January 1, 35 2020.
36 SUMMARY 37 This bill requires corporations that file unitary income tax returns in Maine to include 38 income from certain jurisdictions outside the United States in net income when 39 apportioning income among tax jurisdictions. The State Tax Assessor is required to 40 adopt major substantive rules to determine the income or loss attributable to such
Page 1 - 129LR0257(01)-1 1 corporations and to prevent double taxation or deduction of income. The assessor is 2 required to submit an annual report to the joint standing committee of the Legislature 3 having jurisdiction over taxation matters regarding whether jurisdictions should be added 4 to or deleted from the list of tax havens based on specified criteria.
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