I 

110TH CONGRESS 

1ST SESSION H. R. 2372 

To amend the Internal Revenue Code of 1986 to impose a temporary windfall 

profit tax on crude oil, to make the revenues from such tax available 

for investments in renewable energy and energy efficiency, and for other 

purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 17, 2007 

Ms. DELAURO (for herself, Ms. KAPTUR, Mr. COHEN, and Mr. FATTAH) introduced the following bill; which was referred to the Committee on Ways 

and Means, and in addition to the Committees on the Budget and Rules, 

for a period to be subsequently determined by the Speaker, in each case 

for consideration of such provisions as fall within the jurisdiction of the 

committee concerned 

A BILL 

To amend the Internal Revenue Code of 1986 to impose 

a temporary windfall profit tax on crude oil, to make 

the revenues from such tax available for investments 

in renewable energy and energy efficiency, 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, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Windfall Energy Alter3 natives for the Nation (WEAN) Off of Oil Act of 2007’’ 

4 or the ‘‘WEAN Off of Oil Act of 2007’’. 

5 SEC. 2. WINDFALL PROFITS TAX. 

6 (a) IN GENERAL.—Subtitle E of the Internal Rev7 enue Code of 1986 (relating to alcohol, tobacco, and cer8 tain other excise taxes) is amended by adding at the end 

9 thereof the following new chapter: 

10 ‘‘CHAPTER 56—WINDFALL PROFITS ON 

11 CRUDE OIL 

‘‘Sec. 5896. Imposition of tax. 

‘‘Sec. 5897. Windfall profit; removal price; adjusted base price; qualified investment. 

‘‘Sec. 5898. Special rules and definitions. 

12 ‘‘SEC. 5896. IMPOSITION OF TAX. 

13 ‘‘(a) IN GENERAL.—In addition to any other tax im14 posed under this title, there is hereby imposed on any 

15 major integrated oil company (as defined in section 

16 167(h)(5)(B)) an excise tax equal to the excess of— 

17 ‘‘(1) the amount equal to 50 percent of the 

18 windfall profit from all barrels of taxable crude oil 

19 removed from the property during each taxable year, 

20 over 

21 ‘‘(2) the amount of qualified investment by such 

22 company during such taxable year. 


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1 ‘‘(b) FRACTIONAL PART OF BARREL.—In the case of 

2 a fraction of a barrel, the tax imposed by subsection (a) 

3 shall be the same fraction of the amount of such tax im4 posed on the whole barrel. 

5 ‘‘(c) TAX PAID BY PRODUCER.—The tax imposed by 

6 this section shall be paid by the producer of the taxable 

7 crude oil. 

8 ‘‘SEC. 5897. WINDFALL PROFIT; REMOVAL PRICE; AD9 JUSTED BASE PRICE; QUALIFIED INVEST10 MENT. 

11 ‘‘(a) GENERAL RULE.—For purposes of this chapter, 

12 the term ‘windfall profit’ means the excess of the removal 

13 price of the barrel of taxable crude oil over the adjusted 

14 base price of such barrel. 

15 ‘‘(b) REMOVAL PRICE.—For purposes of this chap16 ter— 

17 ‘‘(1) IN GENERAL.—Except as otherwise pro18 vided in this subsection, the term ‘removal price’ 

19 means the amount for which the barrel of taxable 

20 crude oil is sold. 

21 ‘‘(2) SALES BETWEEN RELATED PERSONS.—In 

22 the case of a sale between related persons, the re23 moval price shall not be less than the constructive 

24 sales price for purposes of determining gross income 

25 from the property under section 613. 


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1 ‘‘(3) OIL REMOVED FROM PROPERTY BEFORE

2 SALE.—If crude oil is removed from the property be3 fore it is sold, the removal price shall be the con4 structive sales price for purposes of determining 

5 gross income from the property under section 613. 

6 ‘‘(4) REFINING BEGUN ON PROPERTY.—If the 

7 manufacture or conversion of crude oil into refined 

8 products begins before such oil is removed from the 

9 property— 

10 ‘‘(A) such oil shall be treated as removed 

11 on the day such manufacture or conversion be12 gins, and 

13 ‘‘(B) the removal price shall be the con14 structive sales price for purposes of determining 

15 gross income from the property under section 

16 613. 

17 ‘‘(5) PROPERTY.—The term ‘property’ has the 

18 meaning given such term by section 614. 

19 ‘‘(c) ADJUSTED BASE PRICE DEFINED.— 

20 ‘‘(1) IN GENERAL.—For purposes of this chap21 ter, the term ‘adjusted base price’ means $50 for 

22 each barrel of taxable crude oil plus an amount 

23 equal to— 

24 ‘‘(A) such base price, multiplied by 


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1 ‘‘(B) the inflation adjustment for the cal2 endar year in which the taxable crude oil is re3 moved from the property. 

4 The amount determined under the preceding sen5 tence shall be rounded to the nearest cent. 

6 ‘‘(2) INFLATION ADJUSTMENT.— 

7 ‘‘(A) IN GENERAL.—For purposes of para8 graph (1), the inflation adjustment for any cal9 endar year after 2008 is the percentage by 

10 which— 

11 ‘‘(i) the implicit price deflator for the 

12 gross national product for the preceding 

13 calendar year, exceeds 

14 ‘‘(ii) such deflator for the calendar 

15 year ending December 31, 2007. 

16 ‘‘(B) FIRST REVISION OF PRICE DEFLATOR

17 USED.—For purposes of subparagraph (A), the 

18 first revision of the price deflator shall be used. 

19 ‘‘(d) QUALIFIED INVESTMENT.—For purposes of this 

20 chapter— 

21 ‘‘(1) IN GENERAL.—The term ‘qualified invest22 ment’ means any amount paid or incurred with re23 spect to— 

24 ‘‘(A) section 263(c) costs, 


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1 ‘‘(B) qualified refinery property (as defined 

2 in section 179C(c) and determined without re3 gard to any termination date), 

4 ‘‘(C) any qualified facility described in 

5 paragraph (1), (2), (3), or (4) of section 45(d) 

6 (determined without regard to any placed in 

7 service date), and 

8 ‘‘(D) any facility for the production of al9 cohol used as a fuel (within the meaning of sec10 tion 40) or biodiesel or agri-biodiesel used as a 

11 fuel (within the meaning of section 40A). 

12 ‘‘(2) SECTION 263(c) COSTS.—For purposes of 

13 this subsection, the term ‘section 263(c) costs’ 

14 means intangible drilling and development costs in15 curred by the taxpayer which (by reason of an elec16 tion under section 263(c)) may be deducted as ex17 penses for purposes of this title (other than this 

18 paragraph). Such term shall not include costs in19 curred in drilling a nonproductive well. 

20 ‘‘SEC. 5898. SPECIAL RULES AND DEFINITIONS. 

21 ‘‘(a) WITHHOLDING AND DEPOSIT OF TAX.—The 

22 Secretary shall provide such rules as are necessary for the 

23 withholding and deposit of the tax imposed under section 

24 5896 on any taxable crude oil. 


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1 ‘‘(b) RECORDS AND INFORMATION.—Each taxpayer 

2 liable for tax under section 5896 shall keep such records, 

3 make such returns, and furnish such information (to the 

4 Secretary and to other persons having an interest in the 

5 taxable crude oil) with respect to such oil as the Secretary 

6 may by regulations prescribe. 

7 ‘‘(c) RETURN OF WINDFALL PROFIT TAX.—The Sec8 retary shall provide for the filing and the time of such 

9 filing of the return of the tax imposed under section 5896. 

10 ‘‘(d) DEFINITIONS.—For purposes of this chapter— 

11 ‘‘(1) PRODUCER.—The term ‘producer’ means 

12 the holder of the economic interest with respect to 

13 the crude oil. 

14 ‘‘(2) CRUDE OIL.— 

15 ‘‘(A) IN GENERAL.—The term ‘crude oil’ 

16 includes crude oil condensates and natural gas17 oline. 

18 ‘‘(B) EXCLUSION OF NEWLY DISCOVERED

19 OIL.—Such term shall not include any oil pro20 duced from a well drilled after the date of the 

21 enactment of the WEAN Off of Oil Act of 

22 2007, except with respect to any oil produced 

23 from a well drilled after such date on any prov24 en oil or gas property (within the meaning of 

25 section 613A(c)(9)(A)). 


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1 ‘‘(3) BARREL.—The term ‘barrel’ means 42 

2 United States gallons. 

3 ‘‘(e) ADJUSTMENT OF REMOVAL PRICE.—In deter4 mining the removal price of oil from a property in the case 

5 of any transaction, the Secretary may adjust the removal 

6 price to reflect clearly the fair market value of oil removed. 

7 ‘‘(f) REGULATIONS.—The Secretary shall prescribe 

8 such regulations as may be necessary or appropriate to 

9 carry out the purposes of this chapter. 

10 ‘‘(g) TERMINATION.—This section shall not apply to 

11 taxable crude oil removed after the date which is 3 years 

12 after the date of the enactment of this section.’’. 

13 (b) CLERICAL AMENDMENT.—The table of chapters 

14 for subtitle E of the Internal Revenue Code of 1986 is 

15 amended by adding at the end the following new item: 

‘‘CHAPTER 56. WINDFALL PROFIT ON CRUDE OIL.’’. 

16 (c) DEDUCTIBILITY OF WINDFALL PROFIT TAX.— 

17 The first sentence of section 164(a) of the Internal Rev18 enue Code of 1986 (relating to deduction for taxes) is 

19 amended by inserting after paragraph (5) the following 

20 new paragraph: 

21 ‘‘(6) The windfall profit tax imposed by section 

22 5896.’’. 

23 (d) EFFECTIVE DATE.— 

24 (1) IN GENERAL.—The amendments made by 

25 this section shall apply to crude oil removed after 


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1 the date of the enactment of this Act, in taxable 

2 years ending after such date. 

3 (2) TRANSITIONAL RULES.—For the period 

4 ending December 31, 2007, the Secretary of the 

5 Treasury or the Secretary’s delegate shall prescribe 

6 rules relating to the administration of chapter 56 of 

7 the Internal Revenue Code of 1986. To the extent 

8 provided in such rules, such rules shall supplement 

9 or supplant for such period the administrative provi10 sions contained in chapter 56 of such Code (or in so 

11 much of subtitle F of such Code as relates to such 

12 chapter 56). 

13 SEC. 3. STRATEGIC ENERGY EFFICIENCY AND RENEW14 ABLES RESERVE FOR INVESTMENTS IN RE15 NEWABLE ENERGY AND ENERGY EFFI16 CIENCY. 

17 (a) IN GENERAL.—For budgetary purposes, the addi18 tional Federal receipts by reason of the enactment of this 

19 Act shall be held in a separate account to be known as 

20 the ‘‘Strategic Energy Efficiency and Renewables Re21 serve’’. The Strategic Energy Efficiency and Renewables 

22 Reserve shall be available to offset the cost of subsequent 

23 legislation— 

24 (1) to accelerate the use of clean domestic re25 newable energy resources and alternative fuels; 


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1 (2) to promote the utilization of energy-efficient 

2 products and practices and conservation; and 

3 (3) to increase research, development, and de4 ployment of clean renewable energy and efficiency 

5 technologies. 

6 (b) PROCEDURE FOR ADJUSTMENTS.— 

7 (1) BUDGET COMMITTEE CHAIRMAN.—After the 

8 reporting of a bill or joint resolution, or the offering 

9 of an amendment thereto or the submission of a con10 ference report thereon, providing funding for the 

11 purposes set forth in subsection (a) in excess of the 

12 amounts provided for those purposes for fiscal year 

13 2007, the chairman of the Committee on the Budget 

14 of the applicable House of Congress shall make the 

15 adjustments set forth in paragraph (2) for the 

16 amount of new budget authority and outlays in that 

17 measure and the outlays flowing from that budget 

18 authority. 

19 (2) MATTERS TO BE ADJUSTED.—The adjust20 ments referred to in paragraph (1) are to be made 

21 to— 

22 (A) the discretionary spending limits, if 

23 any, set forth in the appropriate concurrent res24 olution on the budget; 


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1 (B) the allocations made pursuant to the 

2 appropriate concurrent resolution on the budget 

3 pursuant to section 302(a) of the Congressional 

4 Budget Act of 1974; and 

5 (C) the budget aggregates contained in the 

6 appropriate concurrent resolution on the budget 

7 as required by section 301(a) of the Congres8 sional Budget Act of 1974. 

9 (3) AMOUNTS OF ADJUSTMENTS.—The adjust10 ments referred to in paragraphs (1) and (2) shall 

11 not exceed the receipts estimated by the Congres12 sional Budget Office that are attributable to this Act 

13 for the fiscal year in which the adjustments are 

14 made. 

Æ 


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