HP0235, LD 341, item 1, An Act To Prevent Tax Haven Abuse

An Act To Prevent Tax Haven Abuse

Be it enacted by the People of the State of Maine as follows:

Sec. 1. 36 MRSA §5200, sub-§5, as enacted by PL 2005, c. 457, Pt. FFF, §1 and affected by §2, is repealed and the following enacted in its place:

5. Net income. For purposes of this section, "net income" means for any taxable year the total of the following as modified by section 5200-A:

A. The taxable income of the taxpayer for that taxable year under the laws of the United States; and

B. The taxable income or loss of any corporation that is a member of a unitary group and that is incorporated in any of the following jurisdictions: the Principality of Andorra, Anguilla, Antigua and Barbuda, Aruba, the Commonwealth of the Bahamas, the Kingdom of Bahrain, Barbados, Belize, Bermuda, the British Virgin Islands, the Cayman Islands, the Cook Islands, the Republic of Cyprus, the Commonwealth of Dominica, Gibraltar, Grenada, the Bailiwick of Guernsey, the Republic of Ireland, the Isle of Man, the Bailiwick of Jersey, the Republic of Liberia, the Principality of Liechtenstein, the Grand Duchy of Luxembourg, Malta, the Republic of the Marshall Islands, the Republic of Mauritius, the Principality of Monaco, Montserrat, the Republic of Nauru, the Caribbean Netherlands, Niue, the Independent State of Samoa, the Republic of San Marino, the Republic of Seychelles, the Federation of St. Christopher and Nevis, St. Lucia, St. Vincent and the Grenadines, the Turks and Caicos Islands, the United States Virgin Islands and the Republic of Vanuatu.

Sec. 2. Rules. The State Tax Assessor shall adopt rules to determine the income or loss for a corporation that is a member of a unitary group that is not otherwise required to file a consolidated federal return and to prevent double taxation or double deduction of any amount included in the computation of net income under the Maine Revised Statutes, Title 36, section 5200, subsection 5. Rules adopted pursuant to this section are major substantive rules as described in Title 5, chapter 375, subchapter 2-A.

Sec. 3. Application. This Act applies to tax years beginning on or after January 1, 2016.

SUMMARY

This bill requires corporations that file unitary income tax returns in Maine to include income from certain jurisdictions outside the United States in net income when apportioning income among tax jurisdictions. The State Tax Assessor is required to adopt major substantive rules to determine the income or loss attributable to such corporations and to prevent double taxation or deduction of income.

HP0235 LD 341	Session - 127th Maine Legislature		LR 181 Item 1
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