NO GOTION Act

Bill Number

S. 369

Origin Chamber

Senate

Congress

119th Congress, Session 1

Policy Area

Taxation

Status

Introduced

Latest Action

2025-02-03: Read twice and referred to the Committee on Finance.

Last Updated

2026-05-15T12:45:14Z

AI-Generated Summary

Purpose

The legislation, titled the "No Official Giveaways Of Taxpayers' Income to Oppressive Nations Act" (NO GOTION Act), aims to prevent companies linked to foreign adversaries from receiving U.S. tax benefits intended to promote green energy. It seeks to protect American taxpayers by ensuring these incentives support domestic or non-adversarial energy development rather than benefiting hostile nations.

Key Provisions

• Denial of Tax Benefits: Adds a new section (7531) to the Internal Revenue Code that disqualifies "disqualified companies" from claiming various green energy tax credits and deductions. These include incentives for alternative fuels (e.g., sections 30C, 40, 40A), clean electricity production (e.g., sections 45Y, 45Z), carbon capture (section 45Q), and energy-efficient buildings (section 179D).
• Definition of Disqualified Company: Broadly defines such entities to include:
• Governments, agencies, or entities owned, controlled, or directed by a "foreign adversary."
• Companies organized under the laws of or headquartered in a foreign adversary.
• Entities with at least 10% equity interests (by value, voting power, or influence) held by foreign adversary-linked parties, including through joint ventures or derivatives.
• Companies controlled, influenced, or operated under the direction of foreign adversaries.
• Entities with certain financial ties, such as debt, leases, management contracts, or manufacturing agreements that provide substantial benefits to adversaries (with exceptions for arm's-length purchases of equipment).
• Foreign Adversary Definition: Refers to "covered nations" under U.S. law (10 U.S.C. § 4872(d)(2), typically including countries like China, Russia, Iran, and North Korea), plus Cuba and Venezuela (while Nicolás Maduro is president).
• Administration and Guidance: Authorizes the Secretary of the Treasury to issue rules for implementation, including handling publicly traded companies and preventing evasion (e.g., through circumvention strategies).
• Effective Date: Applies to taxable years beginning after the date of enactment.

Significant Changes to Existing Law

• Introduces a new restriction in Chapter 77 of the Internal Revenue Code, specifically targeting green energy incentives (previously available without such foreign ownership checks).
• Expands the scope of foreign adversary definitions by incorporating military law references and adding Cuba and Venezuela conditionally.
• Shifts from general tax eligibility rules to explicit prohibitions based on ownership, control, or influence thresholds (e.g., 10% equity), which were not previously tied to green energy benefits in this manner.

Potential Impacts

• On Government Agencies: The IRS will need to enforce new compliance checks, potentially increasing administrative workload for auditing ownership and influence in tax filings. The Treasury Department may develop guidance, affecting resource allocation.
• On Citizens and Businesses: U.S. green energy companies unaffiliated with adversaries could gain a competitive edge by retaining full access to incentives, encouraging domestic investment. Taxpayers may see indirect benefits through reduced subsidies to adversarial-linked firms, though it could raise costs for projects involving international supply chains.
• On International Relations: May strain ties with designated foreign adversaries by limiting their companies' access to U.S. markets and incentives, signaling a push for "decoupling" in critical sectors like clean energy. It could influence global investment flows, deterring partnerships with adversarial nations.

Main Stakeholders Affected

• U.S. Green Energy Companies: Benefit from reduced competition but may face challenges if reliant on foreign components or partnerships.
• Foreign Companies from Adversarial Nations: Directly lose eligibility for tax breaks, impacting their U.S. operations (e.g., in solar, wind, or EV sectors).
• U.S. Taxpayers and Investors: Protected from subsidizing adversarial entities but potentially facing higher energy costs if supply chains are disrupted.
• Federal Agencies (IRS and Treasury): Responsible for enforcement and guidance.
• International Partners: Non-adversarial allies (e.g., in Europe or Canada) may see opportunities in redirected investments.

Notable Legal, Constitutional, or Political Implications

• Legal: Relies on existing definitions of "control" from federal regulations (31 C.F.R. § 800.208), ensuring consistency, but introduces broad influence criteria that could lead to litigation over determinations of ownership or "material influence." Arm's-length exceptions clarify fair trade but may require case-by-case reviews.
• Constitutional: Falls within Congress's taxing and spending powers under Article I, with no apparent First Amendment or due process issues, as it regulates economic incentives rather than speech or rights.
• Political: Highlights national security concerns in energy policy, potentially advancing U.S. strategic goals against adversaries, but could be seen as protectionist, affecting bipartisan support for green initiatives. The targeted additions (Cuba, Venezuela) reflect specific geopolitical tensions.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Sen. Scott, Rick [R-FL]

Recent Actions

• 2025-02-03: Read twice and referred to the Committee on Finance.
• 2025-02-03: Introduced in Senate

Bill Versions

• No Official Giveaways Of Taxpayers’ Income to Oppressive Nations Act — issued 2025-02-03 — PDF (7 pages)