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Bill

S 3811

A bill to prohibit the award of Federal Government contracts to inverted domestic corporations, and for other purposes.

119th Congress Introduced by Tammy Duckworth and 3 co-sponsors

Bill prohibits federal contracts to U.S. corporations that moved tax residency abroad, using procurement policy to discourage corporate tax inversion strategies.

Introduced in Senate
1
WeVote Research Nonpartisan
Bill Summary · S 3811

Legislative bill overview

S 3811 prohibits the federal government from awarding contracts to "inverted domestic corporations"—companies that have relocated their tax domicile to a foreign country while maintaining significant U.S. operations to reduce their tax burden. The bill aims to penalize corporate tax avoidance strategies by making these companies ineligible for federal contracts worth billions of dollars annually.

Why is this important

Federal contracts represent a substantial financial opportunity for corporations, making contract eligibility a meaningful enforcement mechanism. This bill attempts to address corporate tax avoidance without raising taxes directly, instead using procurement policy as a lever to discourage inversions and protect the federal tax base.

Potential points of contention

  • Definition and scope: Questions about how "inverted domestic corporations" are precisely defined and whether the restrictions could inadvertently catch companies with legitimate foreign operations or dual-listed structures
  • Economic competitiveness: Critics may argue that restricting contractor pools could reduce competition, increase contract costs for taxpayers, or disadvantage American companies competing globally
  • Constitutional and legal challenges: Potential due process concerns about using contracting policy to enforce tax policy, and questions about whether this effectively becomes an unconstitutional punishment or violates contract law principles

Compiled from official sources — confirm details with the bill’s official record.

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