I
119THCONGRESS
1
STSESSION 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
FEBRUARY13, 2025
Ms. M
ALLIOTAKIS(for herself, Mr. PANETTA, Mr. BUCHANAN, Ms.
V
ELA´ZQUEZ, Mr. KELLYof Pennsylvania, Mr. HERNA´NDEZ, and Mr.
L
AWLER) introduced the following bill; which was referred to the Com-
mittee 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 Representa-1
tives of the United States of America in Congress assembled, 2
SECTION 1. SHORT TITLE. 3
This Act may be cited as the ‘‘Supply Chain Security 4
and Growth Act of 2025’’. 5
SEC. 2. CRITICAL SUPPLY CHAINS RESHORING INVEST-6
MENT CREDIT. 7
(a) I
NGENERAL.—Subpart E of part IV of sub-8
chapter A of the Internal Revenue Code of 1986 is amend-9
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ed by inserting after section 48E the following new sec-1
tion: 2
‘‘SEC. 48F. CRITICAL SUPPLY CHAINS RESHORING INVEST-3
MENT CREDIT. 4
‘‘(a) I
NGENERAL.—For purposes of section 46, in 5
the case of a qualifying taxpayer, the critical supply chains 6
reshoring investment credit is an amount equal to 40 per-7
cent of the qualified investment with respect to any critical 8
supply chain facility placed in service during such taxable 9
year. 10
‘‘(b) D
EFINITIONS ANDSPECIALRULES.—For pur-11
poses of this section— 12
‘‘(1) Q
UALIFYING TAXPAYER.— 13
‘‘(A) I
N GENERAL.—The term ‘qualifying 14
taxpayer’ means a taxpayer that is not a pro-15
hibited foreign entity. 16
‘‘(B) P
ROHIBITED FOREIGN ENTITY .—For 17
purposes of this paragraph, the term ‘prohibited 18
foreign entity’ means— 19
‘‘(i) any foreign entity of concern (as 20
defined in section 40207(a)(5) of the In-21
frastructure Investment and Jobs Act), 22
‘‘(ii) any entity with respect to which 23
the government of a covered nation has the 24
right or power (directly or indirectly) to 25
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appoint or approve the appointment of a 1
covered officer, or 2
‘‘(iii) any entity 25 percent or more of 3
the capital or profits interests of which are 4
owned (directly or indirectly) in the aggre-5
gate by 1 or more of the following: 6
‘‘(I) A covered nation or an enti-7
ty described in clause (i) or (ii). 8
‘‘(II) A citizen, national, or resi-9
dent of a covered nation. 10
‘‘(III) An entity organized under 11
the laws of a covered nation. 12
‘‘(C) C
OVERED OFFICER.—For purposes of 13
this paragraph, the term ‘covered officer’ 14
means— 15
‘‘(i) any member of the board of direc-16
tors, board of supervisors, or an equivalent 17
governing body, 18
‘‘(ii) the president, senior vice presi-19
dent, chief executive officer, chief operating 20
officer, chief financial officer, or general 21
counsel, or 22
‘‘(iii) any individual who performs du-23
ties usually associated with a title listed in 24
clause (i) or (ii). 25
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‘‘(D) COVERED NATION.—For purposes of 1
this paragraph, the term ‘covered nation’ has 2
the meaning given such term in section 4872(d) 3
of title 10, United States Code. 4
‘‘(2) Q
UALIFIED INVESTMENT .—The qualified 5
investment with respect to any critical supply chain 6
facility for any taxable year is an amount equal to 7
the basis of any qualified property placed in service 8
by the taxpayer during such taxable year which is 9
part of a such facility. 10
‘‘(3) Q
UALIFYING PROPERTY.— 11
‘‘(A) I
N GENERAL.—The term ‘qualifying 12
property’ means property— 13
‘‘(i) that is integral to the operation 14
of a critical supply chain facility, 15
‘‘(ii) that is tangible property, 16
‘‘(iii) with respect to which deprecia-17
tion (or amortization in lieu of deprecia-18
tion) is allowable, and 19
‘‘(iv) which is— 20
‘‘(I) constructed, reconstructed, 21
or erected by the taxpayer, or 22
‘‘(II) acquired by the taxpayer if 23
the original use of such property com-24
mences with the taxpayer. 25
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‘‘(B) RECONSTRUCTED PROPERTY .—Prop-1
erty shall be treated as reconstructed for pur-2
poses of this paragraph if improvements to such 3
property satisfy the substantial improvement 4
test of section 1400Z–2(d)(2)(D)(ii). 5
‘‘(4) C
RITICAL SUPPLY CHAIN FACILITY .—The 6
term ‘critical supply chain facility’ means a facil-7
ity— 8
‘‘(A) the primary purpose of which is the 9
manufacturing of— 10
‘‘(i) An active pharmaceutical ingre-11
dient (as defined in section 2017.1 of title 12
21, Code of Federal Regulations (or any 13
successor regulations)), 14
‘‘(ii) A drug (as defined in section 15
201(g) of the Federal Food, Drug, and 16
Cosmetic Act), 17
‘‘(iii) A biological product (as defined 18
in section 351(i)(1) of the Public Health 19
Service Act), 20
‘‘(iv) A medical countermeasure (as 21
defined in section 319F–3(i)(1) of the 22
Public Health Service Act), 23
‘‘(v) A medical diagnostic device (as 24
defined in section 201(h) of the Federal 25
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Food, Drug, and Cosmetic Act) intended 1
for use in the diagnosis of disease or other 2
conditions, 3
‘‘(vi) Semiconductors or semicon-4
ductor manufacturing equipment, 5
‘‘(vii) Aerospace equipment as defined 6
under North American Industry Classifica-7
tion Code 3364, or 8
‘‘(viii) Artificial nanomaterials, and 9
‘‘(B) located in— 10
‘‘(i) a ‘specified possession’ within the 11
meaning of section 937(c), 12
‘‘(ii) or Puerto Rico. 13
‘‘(5) A
GGREGATION RULE.— 14
‘‘(A) I
N GENERAL.—Members of a quali-15
fied affiliated group shall be treated as a single 16
taxpayer. 17
‘‘(B) Q
UALIFIED AFFILIATED GROUP .— 18
‘‘(i) I
N GENERAL.—The term ‘quali-19
fied affiliated group’ means an affiliated 20
group (as defined in section 1504(a), de-21
termined without regard to section 22
1504(b)(3)) at least 1 member of which 23
has made a qualified investment in a crit-24
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ical supply chain facility located in an eco-1
nomically distressed zone. 2
‘‘(ii) E
CONOMICALLY DISTRESSED 3
ZONE.—For purposes of this subpara-4
graph, the term ‘economically distressed 5
zone’ means a population census tract 6
that— 7
‘‘(I) is a qualified opportunity 8
zone (as defined in section 1400z– 9
1(a)), and 10
‘‘(II) has a poverty rate of not 11
less than 30 percent. 12
‘‘(6) E
XEMPTION FROM CERTAIN SPECIAL 13
RULES.—The credit determined under subsection (a) 14
shall be determined without regard to paragraphs 15
(1) and (4) of section 50(b).’’. 16
(b) C
OORDINATION BETWEENCRITICALSUPPLY 17
C
HAINSRESHORINGCREDIT ANDELECTRICITYPRODUC-18
TIONCREDIT.—Section 45(e) of such Code is amended 19
by adding at the end the following new subsection: 20
‘‘(e) C
OORDINATION WITHCRITICALSUPPLY 21
C
HAINSRESHORINGINVESTMENT CREDIT.—The term 22
‘qualified facility’ shall not include any facility if a credit 23
is allowed under section 48F with respect to such facility 24
for the taxable year or any prior taxable year.’’. 25
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(c) ELECTIVEPAYMENTALLOWED.— 1
(1) I
N GENERAL.—Section 6417(b) of such 2
Code is amended by adding at the end the following: 3
‘‘(13) The critical supply chains reshoring in-4
vestment credit determined under section 48F.’’. 5
(2) E
LECTION TO BE TREATED AS APPLICABLE 6
ENTITY.—Section 6417(d)(1) is amended— 7
(A) by redesignating subparagraph (E) as 8
subparagraph (F), and 9
(B) by inserting after subparagraph (D) 10
the following new subparagraph: 11
‘‘(E) E
LECTION WITH RESPECT TO CRIT -12
ICAL SUPPLY CHAINS RESHORING CREDIT .—If a 13
taxpayer other than an entity described in sub-14
paragraph (A) makes an election under this 15
subparagraph with respect to any taxable year 16
in which such taxpayer has placed in service a 17
critical supply chain facility (as defined in sec-18
tion 48F(b)(4)), such taxpayer shall be treated 19
as an applicable entity for purposes of this sec-20
tion for such taxable year, but only with respect 21
to the credit described in subsection (b)(13).’’. 22
(d) C
REDITMADETRANSFERABLE.—Section 23
6418(f)(1)(A) of such Code is amended by adding at the 24
end the following: 25
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‘‘(xii) The critical supply chains re-1
shoring investment credit determined 2
under section 48F.’’. 3
(e) C
REDITINCLUDED ININVESTMENTCREDIT.— 4
Section 46 of such Code is amended by striking ‘‘and’’ 5
at the end of paragraph (6), by striking the period at the 6
end of paragraph (7) and inserting ‘‘, and’’, and by adding 7
at the end the following new paragraph: 8
‘‘(8) the critical supply chains reshoring invest-9
ment credit.’’. 10
(f) E
FFECTIVEDATE.—The amendments made by 11
this section shall apply to property placed in service after 12
December 31, 2024. 13
SEC. 3. INCREASE IN DEEMED CREDIT FOR TAXES PAID TO 14
POSSESSION OF THE UNITED STATES. 15
(a) I
NGENERAL.—Section 960(d) of the Internal 16
Revenue Code of 1986 is amended by adding at the end 17
the following new paragraph: 18
‘‘(4) I
NCREASE FOR TAXES PAID TO POSSES -19
SION OF UNITED STATES.—In the case of tested for-20
eign income taxes paid or accrued to a possession of 21
the United States, paragraph (1) shall be applied by 22
substituting ‘100 percent’ for ‘80 percent’.’’. 23
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(b) EFFECTIVEDATE.—The amendments made by 1
this section shall apply to taxes paid or accrued after De-2
cember 31, 2024. 3
Æ
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