119-hr1328

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1328 Introduced in House

    (IH) ]

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119th CONGRESS
 1st Session
 H. R. 1328

 To amend the Internal Revenue Code of 1986 to establish the critical 
 supply chains reshoring investment tax credit.

_______________________________________________________________________

 IN THE HOUSE OF REPRESENTATIVES

 February 13, 2025

Ms. Malliotakis (for herself, Mr. Panetta, Mr. Buchanan, Ms. Velazquez, 
 Mr. Kelly of Pennsylvania, Mr. Hernandez, and Mr. Lawler) introduced 
 the following bill; which was referred to the Committee on Ways and 
 Means

_______________________________________________________________________

 A BILL

 To amend the Internal Revenue Code of 1986 to establish the critical 
 supply chains reshoring investment tax credit.

 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 ``Supply Chain Security and Growth Act 
of 2025''.

SEC. 2. CRITICAL SUPPLY CHAINS RESHORING INVESTMENT CREDIT.

    (a) In General.--Subpart E of part IV of subchapter A of the 
Internal Revenue Code of 1986 is amended by inserting after 

section 48E 
the following new section:

``

SEC. 48F. CRITICAL SUPPLY CHAINS RESHORING INVESTMENT CREDIT.

 ``

    (a) In General.--For purposes of 

section 46, in the case of a 
qualifying taxpayer, the critical supply chains reshoring investment 
credit is an amount equal to 40 percent of the qualified investment 
with respect to any critical supply chain facility placed in service 
during such taxable year.
 ``

    (b) Definitions and Special Rules.--For purposes of this 
section--
 ``

    (1) Qualifying taxpayer.--
 ``
        (A) In general.--The term `qualifying taxpayer' 
 means a taxpayer that is not a prohibited foreign 
 entity.
 ``
        (B) Prohibited foreign entity.--For purposes of 
 this paragraph, the term `prohibited foreign entity' 
 means--
 ``
            (i) any foreign entity of concern (as 
 defined in 

section 40207

    (a)

    (5) of the 
 Infrastructure Investment and Jobs Act),
 ``
            (ii) any entity with respect to which the 
 government of a covered nation has the right or 
 power (directly or indirectly) to appoint or 
 approve the appointment of a covered officer, 
 or
 ``
            (iii) any entity 25 percent or more of 
 the capital or profits interests of which are 
 owned (directly or indirectly) in the aggregate 
 by 1 or more of the following:
 ``
            (I) A covered nation or an entity 
 described in clause
            (i) or
            (ii) .
 ``
            (II) A citizen, national, or 
 resident of a covered nation.
 ``
            (III) An entity organized under 
 the laws of a covered nation.
 ``
            (C) Covered officer.--For purposes of this 
 paragraph, the term `covered officer' means--
 ``
            (i) any member of the board of directors, 
 board of supervisors, or an equivalent 
 governing body,
 ``
            (ii) the president, senior vice 
 president, chief executive officer, chief 
 operating officer, chief financial officer, or 
 general counsel, or
 ``
            (iii) any individual who performs duties 
 usually associated with a title listed in 
 clause
            (i) or
            (ii) .
 ``
            (D) Covered nation.--For purposes of this 
 paragraph, the term `covered nation' has the meaning 
 given such term in 

section 4872
            (d) of title 10, United 
 States Code.
 ``

    (2) Qualified investment.--The qualified investment with 
 respect to any critical supply chain facility for any taxable 
 year is an amount equal to the basis of any qualified property 
 placed in service by the taxpayer during such taxable year 
 which is part of a such facility.
 ``

    (3) Qualifying property.--
 ``
        (A) In general.--The term `qualifying property' 
 means property--
 ``
            (i) that is integral to the operation of 
 a critical supply chain facility,
 ``
            (ii) that is tangible property,
 ``
            (iii) with respect to which depreciation 
 (or amortization in lieu of depreciation) is 
 allowable, and
 ``
            (iv) which is--
 ``
            (I) constructed, reconstructed, 
 or erected by the taxpayer, or
 ``
            (II) acquired by the taxpayer if 
 the original use of such property 
 commences with the taxpayer.
 ``
        (B) Reconstructed property.--Property shall be 
 treated as reconstructed for purposes of this paragraph 
 if improvements to such property satisfy the 
 substantial improvement test of 

section 1400Z-
 2
            (d) (2)
            (D) 
            (ii) .
 ``

    (4) Critical supply chain facility.--The term `critical 
 supply chain facility' means a facility--
 ``
        (A) the primary purpose of which is the 
 manufacturing of--
 ``
            (i) An active pharmaceutical ingredient 
 (as defined in 

section 2017.1 of title 21, Code 
 of Federal Regulations (or any successor 
 regulations)),
 ``
            (ii) A drug (as defined in 

section 201

    (g) of the Federal Food, Drug, and Cosmetic Act),
 ``
            (iii) A biological product (as defined in 
 

section 351
            (i) (1) of the Public Health Service 
 Act),
 ``
            (iv) A medical countermeasure (as defined 
 in 

section 319F-3
            (i) (1) of the Public Health 
 Service Act),
 ``
            (v) A medical diagnostic device (as 
 defined in 

section 201

    (h) of the Federal Food, 
 Drug, and Cosmetic Act) intended for use in the 
 diagnosis of disease or other conditions,
 ``
            (vi) Semiconductors or semiconductor 
 manufacturing equipment,
 ``
            (vii) Aerospace equipment as defined 
 under North American Industry Classification 
 Code 3364, or
 ``
            (viii) Artificial nanomaterials, and
 ``
        (B) located in--
 ``
            (i) a `specified possession' within the 
 meaning of 

section 937
            (c) ,
 ``
            (ii) or Puerto Rico.
 ``

    (5) Aggregation rule.--
 ``
        (A) In general.--Members of a qualified 
 affiliated group shall be treated as a single taxpayer.
 ``
        (B) Qualified affiliated group.--
 ``
            (i) In general.--The term `qualified 
 affiliated group' means an affiliated group (as 
 defined in 

section 1504

    (a) , determined without 
 regard to 

section 1504

    (b)

    (3) ) at least 1 member 
 of which has made a qualified investment in a 
 critical supply chain facility located in an 
 economically distressed zone.
 ``
            (ii) Economically distressed zone.--For 
 purposes of this subparagraph, the term 
 `economically distressed zone' means a 
 population census tract that--
 ``
            (I) is a qualified opportunity 
 zone (as defined in 

section 1400z-
 1

    (a) ), and
 ``
            (II) has a poverty rate of not 
 less than 30 percent.
 ``

    (6) Exemption from certain special rules.--The credit 
 determined under subsection

    (a) shall be determined without 
 regard to paragraphs

    (1) and

    (4) of 

section 50

    (b) .''.

    (b) Coordination Between Critical Supply Chains Reshoring Credit 
and Electricity Production Credit.--

Section 45

    (e) of such Code is 
amended by adding at the end the following new subsection:
 ``

    (e) Coordination With Critical Supply Chains Reshoring Investment 
Credit.--The term `qualified facility' shall not include any facility 
if a credit is allowed under 

section 48F with respect to such facility 
for the taxable year or any prior taxable year.''.
            (c) Elective Payment Allowed.--

    (1) In general.--

Section 6417

    (b) of such Code is amended by 
 adding at the end the following:
 ``

    (13) The critical supply chains reshoring investment 
 credit determined under 

section 48F.''.

    (2) Election to be treated as applicable entity.--

Section 6417
            (d) (1) is amended--
        (A) by redesignating subparagraph
        (E) as 
 subparagraph
        (F) , and
        (B) by inserting after subparagraph
            (D) the 
 following new subparagraph:
 ``
        (E) Election with respect to critical supply 
 chains reshoring credit.--If a taxpayer other than an 
 entity described in subparagraph
        (A) makes an election 
 under this subparagraph with respect to any taxable 
 year in which such taxpayer has placed in service a 
 critical supply chain facility (as defined in 

section 48F

    (b)

    (4) ), such taxpayer shall be treated as an 
 applicable entity for purposes of this section for such 
 taxable year, but only with respect to the credit 
 described in subsection

    (b)

    (13) .''.
            (d) Credit Made Transferable.--

Section 6418

    (f)

    (1)
        (A) of such Code 
is amended by adding at the end the following:
 ``
            (xii) The critical supply chains 
 reshoring investment credit determined under 
 

section 48F.''.

    (e) Credit Included in Investment Credit.--

Section 46 of such Code 
is amended by striking ``and'' at the end of paragraph

    (6) , by striking 
the period at the end of paragraph

    (7) and inserting ``, and'', and by 
adding at the end the following new paragraph:
 ``

    (8) the critical supply chains reshoring investment 
 credit.''.

    (f) Effective Date.--The amendments made by this section shall 
apply to property placed in service after December 31, 2024.

SEC. 3. INCREASE IN DEEMED CREDIT FOR TAXES PAID TO POSSESSION OF THE 
 UNITED STATES.

    (a) In General.--

Section 960
            (d) of the Internal Revenue Code of 
1986 is amended by adding at the end the following new paragraph:
 ``

    (4) Increase for taxes paid to possession of united 
 states.--In the case of tested foreign income taxes paid or 
 accrued to a possession of the United States, paragraph

    (1) shall be applied by substituting `100 percent' for `80 
 percent'.''.

    (b) Effective Date.--The amendments made by this section shall 
apply to taxes paid or accrued after December 31, 2024.
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