Bill > A3678

This bill prohibits certain domestic corporations that have reorganized overseas, primarily to avoid U.S. taxes, from being awarded state contracts or subcontracts for goods, services, or construction projects funded by the state. An "inverted domestic corporation" is defined as a U.S. incorporated company that becomes incorporated in a foreign country or becomes a subsidiary of a foreign-incorporated company to reduce its U.S. tax liability. The State Treasurer will determine if a corporation is an inverted domestic corporation, considering factors like reduced federal tax liability, location of business operations and assets, and ownership by U.S. shareholders, and will automatically deem a corporation an inverted domestic corporation if it has been barred from federal contracts for this reason. The bill also states that these provisions will not apply if they conflict with federal law or jeopardize federal funding, and the State Treasurer is tasked with creating necessary rules and regulations to implement the bill, which takes effect immediately.