I 

116TH CONGRESS 

1ST SESSION H. R. 5457 

To amend the Internal Revenue Code of 1986 to impose an excise tax 

on fuel based on the carbon content of such fuel, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 17, 2019 

Mr. SEAN PATRICK MALONEY of New York introduced the following bill; 

which was referred to the Committee on Ways and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to impose 

an excise tax on fuel based on the carbon content of 

such fuel, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Carbon Reduction and 

5 Tax Credit Act’’. 

6 SEC. 2. EXCISE TAX ON CARBON CONTENT OF FUELS. 

7 (a) IN GENERAL.—Chapter 38 of the Internal Rev8 enue Code of 1986 is amended by adding at the end there9 of the following new subchapter: 


pamtmann on DSKBC07HB2PROD with BILLS
2 

•HR 5457 IH

1 ‘‘Subchapter E—Carbon Content Fee 

‘‘Sec. 4691. Carbon content. 

2 ‘‘SEC. 4691. CARBON CONTENT. 

3 ‘‘(a) IN GENERAL.—In the case of a coal mine or an 

4 oil or gas well, there is hereby imposed a tax equal to $40 

5 per ton of carbon contained in fuel produced— 

6 ‘‘(1) at such mine or well located in the United 

7 States, or 

8 ‘‘(2) entered into the United States for con9 sumption, use, or warehousing. 

10 ‘‘(b) ADJUSTMENT FOR YEARS AFTER 2020.— 

11 ‘‘(1) IN GENERAL.—In the case of any calendar 

12 year after 2020, the amount under subsection (a) 

13 shall be increased by an amount equal to— 

14 ‘‘(A) such amount, multiplied by 

15 ‘‘(B) the cost-of-living adjustment deter16 mined under section 1(f)(3) for such calendar 

17 year, determined— 

18 ‘‘(i) by substituting ‘calendar year 

19 2019’ for ‘calendar year 2016’ in subpara20 graph (A)(ii) thereof, and 

21 ‘‘(ii) by substituting for the C–CPI–U 

22 referred to in section 1(f)(3)(A) the 

23 amount that such CPI would have been if 

24 the annual percentage increase in CPI with 


pamtmann on DSKBC07HB2PROD with BILLS
3 

•HR 5457 IH

1 respect to each year after 2019 had been 

2 one percentage point greater. 

3 ‘‘(2) TERMS RELATED TO CPI.— 

4 ‘‘(A) ANNUAL PERCENTAGE INCREASE.— 

5 For purposes of subparagraph (B)(ii)(II), the 

6 term ‘annual percentage increase’ means the 

7 percentage (if any) by which C–CPI–U for any 

8 year exceeds the C–CPI–U for the prior year. 

9 ‘‘(B) OTHER TERMS.—Terms used in this 

10 paragraph which are also used in section 

11 1(f)(3) shall have the same meanings as when 

12 used in such section. 

13 ‘‘(3) ROUNDING.—Any increase determined 

14 under subparagraph (B) shall be rounded to the 

15 nearest multiple of $50.’’. 

16 (b) CLERICAL AMENDMENT.—The table of sub17 chapters for chapter 38 of the Internal Revenue Code of 

18 1986 is amended by adding at the end the following new 

19 item: 

‘‘SUBCHAPTER E—CARBON CONTENT FEE’’. 

20 (c) EFFECTIVE DATE.—The amendments made by 

21 this section shall apply to fuel produced after December 

22 31, 2019. 

23 SEC. 3. CREDIT. 

24 (a) IN GENERAL.—Subpart C of part IV of sub25 chapter A of chapter 1 of the Internal Revenue Code of 


pamtmann on DSKBC07HB2PROD with BILLS
4 

•HR 5457 IH

1 1986 (relating to refundable credits) is amended by insert2 ing after section 36B the following new section: 

3 ‘‘SEC. 36C. CREDIT FOR TAXPAYERS. 

4 ‘‘(a) ALLOWANCE OF CREDIT.—There shall be al5 lowed as a credit against the tax imposed by this chapter 

6 for the taxable year with respect to each taxpayer who is 

7 an individual and each dependent of the taxpayer an 

8 amount equal to $1,000. 

9 ‘‘(b) LIMITATION BASED ON ADJUSTED GROSS IN10 COME.—The amount of the credit allowable under sub11 section (a) shall be reduced (but not below zero) by $100 

12 for each $1,000 (or fraction thereof) by which the tax13 payer’s adjusted gross income exceeds $314,000 

14 ($157,000 in the case of a return other than a joint re15 turn). 

16 ‘‘(c) INFLATION ADJUSTMENT.—In the case of a tax17 able year beginning after 2020, the dollar amounts in sub18 sections (a) and (b) shall be increased by an amount equal 

19 to— 

20 ‘‘(1) such dollar amount, multiplied by 

21 ‘‘(2) the cost-of-living adjustment determined 

22 under section 1(f)(3) for the calendar year in which 

23 the taxable year begins, determined by substituting 

24 ‘2019’ for ‘2016’ in subparagraph (A)(ii) thereof. 


pamtmann on DSKBC07HB2PROD with BILLS
5 

•HR 5457 IH

1 If any increase under this clause is not a multiple of $50, 

2 such increase shall be rounded to the next lowest multiple 

3 of $50. 

4 ‘‘(d) NONRESIDENT ALIEN INELIGIBLE FOR CRED5 IT.—No credit shall be allowed under this section to any 

6 nonresident alien.’’. 

7 (b) CONFORMING AMENDMENTS.— 

8 (1) Section 6211(b)(4)(A) of such Code is 

9 amended by inserting ‘‘36C,’’ after ‘‘36B,’’. 

10 (2) Paragraph (2) of section 1324(b) of title 

11 31, United States Code, is amended by inserting 

12 ‘‘36C,’’ after ‘‘36B,’’. 

13 (3) The table of sections for subpart C of part 

14 IV of subchapter A of chapter 1 of the Internal Rev15 enue Code of 1986 is amended by inserting after the 

16 item relating to section 36C the following new item: 

‘‘Sec. 36C. Credit for taxpayers.’’. 

17 (c) EFFECTIVE DATE.—The amendments made by 

18 this section shall apply to taxable years beginning after 

19 December 31, 2019. 

Æ 


pamtmann on DSKBC07HB2PROD with BILLS