Title: Corporate Responsibility Fee Act of 2017
Policy area: Taxation

Summary:
Corporate Responsibility Fee Act of 2017
This bill amends the Internal Revenue Code to impose a specified excise tax on certain employers who employ low-wage employees during the taxable year. A "low-wage" employee is an employee who receives wages from the employer that are less than 218% of the federal poverty line. The bill reduces the amount of the tax for employers who provide certain health and retirement benefits to low-wage employees. Government employers, churches, and church organizations are exempt from the tax.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 1777 Introduced in Senate (IS)]

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115th CONGRESS
  1st Session
                                S. 1777

 To amend the Internal Revenue Code of 1986 to impose an excise tax on 
                   employers with low-wage employees.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           September 7, 2017

 Mr. Brown (for himself and Mr. Durbin) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to impose an excise tax on 
                   employers with low-wage employees.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Corporate Responsibility Fee Act of 
2017''.

SEC. 2. IMPOSITION OF EXCISE TAX ON CORPORATIONS WITH LOW-WAGE 
              EMPLOYEES.

    (a) In General.--Subtitle D of the Internal Revenue Code of 1986 is 
amended by adding after chapter 36 the following new chapter:

               ``CHAPTER 37--CORPORATE RESPONSIBILITY TAX

``Sec. 4511. Imposition of tax.

``SEC. 4511. IMPOSITION OF TAX.

    ``(a) In General.--In the case of an applicable employer who 
employs a low-wage employee during the calendar year, there is imposed 
a tax equal to the applicable percentage of the aggregate amount of 
wages paid by the applicable employer with respect to employment of all 
employees of the employer during the calendar year.
    ``(b) Applicable Employer; Low-Wage Employee.--For purposes of this 
section--
            ``(1) Applicable employer.--
                    ``(A) In general.--The term `applicable employer' 
                means, with respect to any calendar year, any employer 
                who was required to make deposits of taxes under 
                chapters 21 and 24 (or who would have been required to 
                make such deposits if the rules of subparagraph (C) 
                applied for such purposes) by the close of the next day 
                for periods aggregating more than 180 days during the 
                preceding calendar year.
                    ``(B) Exception.--Such term shall not include a 
                Federal or other governmental entity or a church or 
                qualified church organization (as such terms are 
                defined in section 3121(w)(3)).
                    ``(C) Aggregation rules.--The rules of subsections 
                (b), (c), (m), and (o) of section 414 shall apply for 
                purposes of this section, except that in applying 
                subsections (b) and (c) of such section, the phrase 
                `more than 50 percent' shall be substituted for the 
                phrase `more than 80 percent' each place it appears.
            ``(2) Low-wage employee.--
                    ``(A) In general.--The term `low-wage employee' 
                means any employee who receives wages from an 
                applicable employer during the calendar year in an 
                amount less than 218 percent of the Federal poverty 
                line (within the meaning of section 2110(c)(5) of the 
                Social Security Act) for an individual. Rules similar 
                to the rules of section 36B(d)(3)(B) shall apply for 
                purposes of this subparagraph.
                    ``(B) Employees employed for less than entire 
                year.--In the case of any employee employed by an 
                applicable taxpayer for less than the entire calendar 
                year, the amount described in subparagraph (A) shall be 
                reduced by an amount which bears the same ratio to such 
                amount as--
                            ``(i) the number of weeks during the 
                        calendar year in which such individual was not 
                        an employee of such applicable employer, bears 
                        to
                            ``(ii) 52.
    ``(c) Applicable Percentage.--For purposes of subsection (a)--
            ``(1) In general.--
                    ``(A) Determination.--The applicable percentage 
                shall be determined as follows:


------------------------------------------------------------------------
 ``In the case of an applicable employer with a low-wage  The applicable
                   employee ratio of:                     percentage is:
------------------------------------------------------------------------
25% or less.............................................             25%
Greater than 25% but not greater than 50%...............             50%
Greater than 50%, but not greater than 75%..............             75%
Greater than 75%........................................           100%.
------------------------------------------------------------------------

                    ``(B) Low-wage employee ratio.--For purposes of 
                subparagraph (A), the low-wage employee ratio with 
                respect to any applicable employer is the ratio 
                (expressed as a percentage) of--
                            ``(i) the number of low-wage employees 
                        employed by the applicable employer during the 
                        calendar year, to
                            ``(ii) the total number of individuals 
                        employed by the applicable employer during such 
                        calendar year.
            ``(2) Health and retirement offset.--
                    ``(A) In general.--In the case of an applicable 
                employer who meets the requirements of subparagraph 
                (B), the applicable percentage shall be reduced (but 
                not below zero) by 25 percentage points.
                    ``(B) Requirements.--An applicable employer meets 
                the requirements of this subparagraph if such 
                applicable employer--
                            ``(i) offers to all full-time low-wage 
                        employees (and their spouse and dependents) the 
                        opportunity to enroll for all months during the 
                        calendar year in minimum essential coverage 
                        under an eligible employer sponsored health 
                        plan (as defined in section 5000A(f)(2)) for 
                        which--
                                    ``(I) the plan's share of the 
                                allowed costs of benefits provided 
                                under the plan is not less than 60 
                                percent of such costs, and
                                    ``(II) the required contribution 
                                (within the meaning of section 
                                5000A(e)(1)(B)) of the employee does 
                                not exceed the applicable percentage of 
                                the annual wages paid to the employee 
                                by the applicable employer, and
                            ``(ii) meets the retirement plan 
                        requirements of subsection (d) for all 
                        employees who are low-wage employees.
                For purposes of clause (i)(II), the applicable 
                percentage is the percentage in effect under section 
                36B(c)(2)(B)(II) for the plan year.
    ``(d) Retirement Plan Requirements.--
            ``(1) In general.--The requirements of this subsection are 
        met for any calendar year with respect to an employee of the 
        applicable employer who is a low-wage employee if the employee 
        is eligible to participate in one or more applicable eligible 
        retirement plans maintained by the applicable employer (or any 
        member of the group of employers treated as an applicable 
        employer under subsection (b)(1)(C)) for a plan year ending 
        with or within the calendar year.
            ``(2) Applicable eligible retirement plan.--For purposes of 
        this subsection, the term `applicable eligible retirement plan' 
        means an eligible retirement plan which, with respect to the 
        plan year described in paragraph (1), is either--
                    ``(A) a defined contribution plan which requires 
                the employer to make nonelective contributions of at 
                least 5 percent of the compensation of the employee, or
                    ``(B) a defined benefit plan--
                            ``(i) with respect to which the accrued 
                        benefit of the employee derived from employer 
                        contributions, when expressed as an annual 
                        retirement benefit, is not less than the 
                        product of--
                                    ``(I) the lesser of 2 percent 
                                multiplied by the employee's years of 
                                service (determined under the rules of 
                                paragraphs (4), (5), and (6) of section 
                                411(a)) with the employer or 20 
                                percent, multiplied by
                                    ``(II) the employee's final average 
                                pay, or
                            ``(ii) which is an applicable defined 
                        benefit plan (as defined in section 
                        411(a)(13)(B))--
                                    ``(I) which meets the interest 
                                credit requirements of section 
                                411(b)(5)(B)(i) with respect to the 
                                plan year, and
                                    ``(II) under which the employee 
                                receives a pay credit for the plan year 
                                which is not less than 5 percent of 
                                compensation.
            ``(3) Definitions and special rules.--For purposes of this 
        subsection--
                    ``(A) Eligible retirement plan.--The term `eligible 
                retirement plan' has the meaning given such term by 
                section 402(c)(8)(B), except that in the case of an 
                account or annuity described in clause (i) or (ii) 
                thereof, such term shall only include an account or 
                annuity which is a simplified employee pension (as 
                defined in section 408(k)).
                    ``(B) Final average pay.--For purposes of paragraph 
                (2)(B)(i)(II), final average pay shall be determined 
                using the period of consecutive years (not exceeding 5) 
                during which the employee had the greatest compensation 
                from the applicable employer.
                    ``(C) Alternative plan designs.--The Secretary may 
                prescribe regulations for an applicable employer to 
                meet the requirements of this subsection through a 
                combination of defined contribution plans or defined 
                benefit plans described in paragraph (1) or through a 
                combination of both such types of plans.
                    ``(D) Plans must meet requirements without taking 
                into account social security and similar contributions 
                and benefits.--A rule similar to the rule of section 
                416(e) shall apply.
                    ``(E) Certain employees may be excluded.--For 
                purposes of paragraph (2)(B)(ii), an employer shall not 
                be treated as failing to meet the requirements of this 
                subsection with respect to employees--
                            ``(i) who have not attained the age of 21 
                        before the close of a plan year,
                            ``(ii) who have less than 1 year of service 
                        with the employer as of any day during the plan 
                        year,
                            ``(iii) who are covered under an agreement 
                        which the Secretary of Labor finds to be a 
                        collective bargaining agreement if there is 
                        evidence that the benefits covered under the 
                        plan were the subject of good faith bargaining 
                        between employee representatives and the 
                        employer, or
                            ``(iv) who are described in section 
                        410(b)(3)(C) (relating to nonresident aliens 
                        working outside the United States).
    ``(e) Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Wages.--The term `wages' has the meaning given such 
        term by section 3121(a) (determined without regard to any 
        dollar limitation contained in such section).
            ``(2) Allocation of tax.--The Secretary shall prescribe 
        such rules as necessary for the allocation of the tax imposed 
        by subsection (a) among different entities treated as a single 
        employer under subsection (b)(1)(C).''.
    (b) Conforming Amendment.--The table of chapters of the Internal 
Revenue Code of 1986 is amended by inserting after the item relating to 
chapter 36 the following new item:

             ``Chapter 37--Corporate Responsibility Tax''.

    (c) Effective Date.--The amendments made by this section shall 
apply to calendar years beginning after the date of the enactment of 
this Act.
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