The NO GOTION Act would add a new provision to the Internal Revenue Code to deny a broad set of green energy tax benefits to any company deemed a “disqualified company” because of involvement with foreign adversaries. The bill targets tax credits and deductions commonly used for renewable energy projects and energy efficiency (such as credits under sections 30C, 40, 40A, 40B, 45, 45Q, 179D, 48, 48C, 48E, and related provisions, as well as sections 6426 and 6427). If a company meets the disqualification criteria, those green energy tax benefits would not apply to that company for taxable years beginning after enactment. The Secretary would issue guidance to implement the rules and prevent evasion, and the act would define “foreign adversary” and related concepts in broad terms, including certain nations and politically connected entities. In short, the bill is designed to restrict the use of green energy tax incentives for projects tied to entities with significant ownership, control, influence, or debt arrangements connected to foreign adversaries, with the goal of safeguarding taxpayer subsidies from being directed to oppressive or strategically problematic foreign actors.
Key Points
- 1Creates new Sec. 7531 to deny green energy tax benefits to “disqualified companies” linked to foreign adversaries.
- 2Defines “foreign adversary” and sets criteria for disqualification, including ownership, control, influence, and debt or other arrangements that confer influence.
- 3Applies to a wide range of green energy benefits (the listed credits and related provisions), effectively blocking these incentives for disqualified companies.
- 4Includes an arm’s length exception for certain debt or financial arrangements and requires an administration framework to determine applicability and prevent evasion.
- 5Effective for taxable years beginning after enactment; the Secretary can issue guidance to implement the rules.