Members of the House Select Committee on the Chinese Communist Party (CCP), alongside Sen. Josh Hawley, R-Mo., introduced the "Dump Investments in Troublesome Communist Holdings Act" (DITCH) Aug. 1. U.S. Rep. Mike Gallagher, R-Wis., chairman of the committee, said public U.S. institutions should not be investing taxpayer funds into companies connected to the CCP.

"American taxpayers should not be forced to subsidize investments that benefit the Chinese Communist Party," Gallagher said in an Aug. 1 committee news release. "Universities, non-profits, public pension funds and other institutions that want preferential tax treatment must choose: are they committed to their professed values or to financing a genocidal communist regime?"

If enacted, the DITCH Act would require tax-exempt entities such as university endowments, public pensions and nonprofit organizations to either divest from Chinese companies or forfeit their tax-exempt status, according to the release. The bill defines Chinese companies as a company that is based or incorporated in China, a company that is owned by a Chinese entity either directly or indirectly, or a company in which Chinese entities own at least 10% of the stock.

"Universities, foundations and other entities are exempt from federal income tax for their work promoting the public good in the United States," Hawley said in the release. "Investing in China does the opposite: it advances the economic ambitions and military modernization efforts of the Chinese Communist Party while selling out American workers and values. These tax-exempt entities must stop investing in China or lose their tax-exempt status."

The DITCH Act would allow for exceptions to certain nonprofits, but in cases of exceptions, the Treasury secretary would have to publicize the reasoning and annually report on investments in China, including a breakdown by sector, according to the release.

"Under the CCP’s military-civil fusion there is no difference between doing business with CCP companies and doing business with China’s military," U.S. Rep. John Moolenaar, R-Mich., another member of the select committee that introduced the bill, said in the release. "Along with the recent State Department travel warning that made it clear that doing due diligence on investments in China could lead to unwarranted detainment in a CCP prison, it is clearer than ever the CCP is not a reliable financial partner. America’s non-profits must stop investing in CCP companies."

Committee members Reps. Rob Wittman, R-Va., and Darin LaHood, R-Ill., also introduced the legislation, according to the release.