An Act To Prevent Tax Haven Abuse
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 FFF, §1 and affected by §2, is repealed and the following enacted in its place:
The State Tax Assessor shall review annually the list of jurisdictions in paragraph B and report to the joint standing committee of the Legislature having jurisdiction over taxation matters whether any jurisdictions should be added to or deleted from the list based on whether the jurisdiction taxes no or only nominal income, the jurisdiction lacks effective exchange of information with other taxing authorities, the jurisdiction lacks governmental transparency and the jurisdiction protects business with no substantial activity.
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, 2020.
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. The assessor is required to submit an annual report to the joint standing committee of the Legislature having jurisdiction over taxation matters regarding whether jurisdictions should be added to or deleted from the list of tax havens based on specified criteria.