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This bill would modify tax rules for large multinational corporations by allowing certain payments to foreign subsidiaries to avoid being classified as "base erosion payments," which are subject to stricter taxation under current law. Specifically, payments to foreign related companies would be excluded from this category if both the foreign recipient company and the payment itself are subject to at least a 15 percent effective foreign income tax rate. The bill affects multinational corporations and their tax obligations, with companies able to establish the foreign tax rates using their applicable financial statements with adjustments as determined by the IRS. The legislation would take effect for tax years beginning after enactment, and it directs the Treasury Secretary to issue regulations defining how companies calculate foreign tax rates and to establish safeguards against tax avoidance schemes. Representatives Andy Kim of New Jersey and Tom Suozzi introduced the bill, which was referred to the House Ways and Means Committee.

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