I. Title and Purpose
- Title: American Workforce Protection and Employment Act
- Purpose: To promote the hiring of American citizens in the United States by establishing a "U.S. Foreign Labor Levy," which imposes a specific tariff on U.S. corporations that hire non-citizen employees, thereby prioritizing American workers in the domestic labor market.
II. Definitions
- American Citizen Worker: A person who possesses U.S. citizenship by birth or naturalization.
- Temporary Worker Visa: All non-immigrant work visas, including but not limited to H-1B, L-1, O-1, TN, and similar categories.
- Green Card Program: Employment-based and family-based lawful permanent residency programs.
- Immediate Family: For sponsorship purposes, defined strictly as a spouse or minor children.
- Foreign Labor: Non-citizen employees working in the U.S. under any visa category.
III. Implementation of the Foreign Labor Levy
1. Work Visa Tax
Employers would pay a per-employee tax based on the visa category of non-citizen workers. The tax would start at a modest rate in Year 1 and increase gradually over several years.
- Tax Rates:
- H-1B Visas: Start at 5% in Year 1, increase to 10% in Year 2, 15% in Year 3, and reach a maximum of 20% by Year 4.
- L-1 Visas: A similar phased approach reflecting the use of intra-company transfers, starting at 5% and reaching a maximum of 20%.
- Exemptions:
Industries experiencing critical labor shortages may qualify for temporary exemptions or reduced rates if they show efforts to hire American citizens.
2. Foreign Worker Payroll Tax
This additional payroll tax would apply specifically to wages paid to foreign workers, beginning at 10% in Year 1 and increasing incrementally each year to reflect the growing emphasis on prioritizing U.S. citizen employment.
- Incremental Increases: The tax would rise by 5% each year, reaching a maximum of 30% by Year 4.
- Tax Application: The tax would apply to all employers with foreign workers on their payroll, creating a direct incentive to hire U.S. citizens over non-citizens.
3. Employee - Remittance Tax
A 9-18% tax would be applied to money transfers sent abroad by foreign workers, targeting the outflow of funds that could otherwise contribute to the domestic economy.
- Transfer Types: This tax would encompass various forms of remittances, including wire transfers, money service transactions (e.g., Western Union), and digital currencies.
- Tax Structure: The tax would start at 9% in Year 1 and gradually increase to a maximum of 18% by Year 4, reflecting the goal of encouraging foreign workers to contribute more to the U.S. economy.
- Revenue Allocation: Proceeds from the remittance tax could be allocated to workforce development programs that upskill American workers, ensuring that the funds enhance the domestic labor market.
4. Offshoring & Remote Labor Tax
Employers would pay a tax based on the number of jobs moved overseas or the number of remote foreign workers hired instead of U.S. citizens. The tax would begin at a modest rate in Year 1 and gradually increase over the following years.
The goal of this tax is to discourage outsourcing by making it less economically advantageous for companies to relocate jobs abroad or hire remote foreign workers. At the same time, it encourages the creation and retention of jobs within the United States, thereby strengthening domestic citizen employment.
- Tax Rate per Worker: Start at 5% in Year 1, increase to 10% in Year 2, 15% in Year 3, and reach a maximum of 20% by Year 4.
- Exemptions:
Industries experiencing critical labor shortages may qualify for temporary exemptions or reduced rates if they show efforts to hire American citizens.
IV. Revenue Allocation and Use of Tax Proceeds
The revenue generated from the foreign labor levy and associated taxes will be strategically allocated to support American workers and enhance the domestic labor market. Key areas of allocation include:
1. Government Assistance and Training Programs
- Workforce Development Initiatives: A significant portion of the tax revenue will fund programs to upskill American workers, including vocational training, apprenticeships, and certifications in high-demand industries.
- Retraining Programs: Targeted initiatives will be developed for workers displaced by foreign labor, ensuring they have access to resources and training to transition into new job opportunities.
- Grants for Educational Institutions: Funding will be provided to community colleges and technical schools to enhance their programs and make them more responsive to the labor market’s needs.
2. Support for Displaced U.S. Citizen Workers
- Financial Assistance: Temporary financial aid will be available to U.S. citizens who have lost their jobs due to foreign labor competition. This aid will help them cover their expenses while seeking new employment.
- Job Placement Services: Establishing partnerships with private sector employers to create job placement services that assist displaced workers in finding new employment opportunities aligned with their skills.
3. Incentives for Companies Hiring U.S. Citizens
- Tax Credits for Hiring U.S. Citizens:
- Companies that hire and maintain a workforce composed primarily of U.S. citizens (over a specific threshold) will be eligible for tax credits.
- Criteria for Eligibility:
- Businesses must demonstrate that at least 85% (or a percentage determined based on the industry) of their workforce is composed of U.S. citizens.
- Companies must maintain U.S. citizen employment for at least 12 months to qualify for tax credits.
- Companies that lay off U.S. workers in favor of non-citizen workers will forfeit eligibility for credits.
Credit Structure:
- Base Credit: Companies receive a base credit per U.S. citizen employee hired.
- Tiered Credit System:
- Tier 1: Small businesses (fewer than 50 employees) receive a higher credit (e.g., $5,000 per employee hired).
- Tier 2: Medium-sized businesses (50-500 employees) receive a moderate credit (e.g., $3,000 per employee hired).
- Tier 3: Large corporations (more than 500 employees) receive a lower credit (e.g., $1,500 per employee hired).
Additional Incentives:
- Companies that retain U.S. workers for 3+ years may receive bonus credits or an extended credit period.
- Retention Credit: An additional $500 annually for each U.S. citizen employee retained for over one year.
Special Considerations for High-Demand Industries:
- Industries facing critical labor shortages (e.g., healthcare, manufacturing) will receive higher tax creditsper U.S. citizen employee hired, including premium credits for the first 5 years.
4. Economic Development Projects
- Community Investment: Allocating funds for infrastructure and community development projects that create jobs and stimulate local economies, benefiting workers and their communities.
- Small Business Support: Providing grants and low-interest loans to small businesses that prioritize hiring American citizens, helping to foster entrepreneurship and job creation.
The proposed "U.S. Foreign Labor Levy" aims to create a more equitable labor market, support American workers, and strengthen the overall economy by strategically directing tax revenue into these areas.
V. Transition Assistance for Affected Industries
1. Support for Affected Industries
- Provide support and funding for industries struggling to adjust to decreased foreign labor.
- Offer training programs to help U.S. workers acquire skills for in-demand jobs.
2. Tax Credits and Grants
- Implement tax incentives for companies that prioritize hiring U.S. citizens.
- Fund workforce training programs to prepare American workers for available jobs.
VI. Robust Enforcement Mechanisms
1. Compliance Audits
- Establish regular audits of companies' hiring practices to ensure adherence to the new regulations.
2. Penalties for Non-Compliance
- Specify penalties for companies failing to comply with the foreign labor levy.
VII. Addressing Concerns
1. Impact Studies
- Conduct economic impact assessments to evaluate how the proposed levy affects the economy, wages, and job availability.
2. Mitigation Strategies
- Identify strategies to minimize potential negative impacts on inflation and business operations.
VIII. Public Awareness Campaign
1. Educating Employers and Communities
- Launch a campaign to inform businesses about the benefits of hiring U.S. citizens.
2. Engagement with Local Communities
- Promote awareness of job opportunities for American workers.
IX. Feedback Mechanism
1. Stakeholder Input
- Create a process for stakeholders to provide feedback on the levy’s implementation.
2. Review Periods
- Include provisions for periodic reviews of the legislation’s impact and allow adjustments based on observed outcomes.
X. Collaborative Efforts
1. Interagency Coordination
- Encourage collaboration among federal agencies (e.g., Labor, Homeland Security, Treasury) to streamline processes.
2. State and Local Partnerships
- Foster partnerships with state and local governments to align efforts and maximize impact.