HIRE Act

Key Points

• This bill, called the HIRE Act, would create a new 25% tax on American businesses that pay foreign workers or companies to provide services to people in the United States. This is often called outsourcing, and the goal is to discourage companies from moving jobs overseas.
• Businesses would no longer be allowed to deduct these outsourcing payments from their income taxes. This means companies would pay more in taxes both through the new 25% fee and by losing a common tax break they currently use for business expenses.
• The money collected from this new tax would go into a Domestic Workforce Fund. This fund would pay for job training, apprenticeships, and programs to help Americans learn new skills, especially in areas where many jobs have been lost to other countries.
• If a company fails to pay this tax, they could face much higher penalties than usual. The bill also requires company leaders to sign off on these payments under penalty of perjury to make sure they are not trying to hide outsourced work.
• If passed, these rules would start on January 1, 2026. It would affect any business that uses foreign labor for things like customer service, tech support, or other services delivered to customers living in the U.S.