II 

109TH CONGRESS 

1ST SESSION S. 1809 

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

profit tax on crude oil and to use the proceeds of the tax collected 

to offset the cost of supplemental spending bills that are targeted to 

aid victims of Hurricanes Katrina and Rita, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

OCTOBER 3, 2005 

Mr. SCHUMER introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to impose 

a temporary windfall profit tax on crude oil and to 

use the proceeds of the tax collected to offset the cost 

of supplemental spending bills that are targeted to aid 

victims of Hurricanes Katrina and Rita, 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 ‘‘Recapture Excess 

5 Profits and Invest in Relief (REPAIR) Act of 2005’’. 
2 

•S 1809 IS

1 SEC. 2. TEMPORARY WINDFALL PROFITS TAX. 

2 (a) IN GENERAL.—Subtitle E of the Internal Rev3 enue Code of 1986 (relating to alcohol, tobacco, and cer4 tain other excise taxes) is amended by adding at the end 

5 thereof the following new chapter: 

6 ‘‘CHAPTER 56—TEMPORARY WINDFALL 

7 PROFITS ON CRUDE OIL 

‘‘Sec. 5896. Imposition of tax. 

‘‘Sec. 5897. Windfall profit; etc. 

‘‘Sec. 5898. Special rules and definitions. 

8 ‘‘SEC. 5896. IMPOSITION OF TAX. 

9 ‘‘(a) IN GENERAL.—In addition to any other tax im10 posed under this title, there is hereby imposed on any ap11 plicable taxpayer an excise tax in an amount equal to 50 

12 percent of the windfall profit of such taxpayer for any tax13 able year beginning during 2005 or 2006. 

14 ‘‘(b) APPLICABLE TAXPAYER.—For purposes of this 

15 chapter, the term ‘applicable taxpayer’ means, with re16 spect to operations in the United States— 

17 ‘‘(1) any integrated oil company (as defined in 

18 section 291(b)(4)), and 

19 ‘‘(2) any other producer or refiner of crude oil 

20 with gross receipts from the sale of such crude oil 

21 or refined oil products for the taxable year exceeding 

22 $100,000,000. 
3 

•S 1809 IS

1 ‘‘SEC. 5897. WINDFALL PROFIT; ETC. 

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

3 the term ‘windfall profit’ means the excess of the adjusted 

4 taxable income of the applicable taxpayer for the taxable 

5 year over the reasonably inflated average profit for such 

6 taxable year. 

7 ‘‘(b) ADJUSTED TAXABLE INCOME.—For purposes of 

8 this chapter, with respect to any applicable taxpayer, the 

9 adjusted taxable income for any taxable year is equal to 

10 the taxable income for such taxable year (within the mean11 ing of section 63 and determined without regard to this 

12 subsection)— 

13 ‘‘(1) increased by any interest expense deduc14 tion, charitable contribution deduction, and any net 

15 operating loss deduction carried forward from any 

16 prior taxable year, and 

17 ‘‘(2) reduced by any interest income, dividend 

18 income, and net operating losses to the extent such 

19 losses exceed taxable income for the taxable year. 

20 In the case of any applicable taxpayer which is a foreign 

21 corporation, the adjusted taxable income shall be deter22 mined with respect to such income which is effectively con23 nected with the conduct of a trade or business in the 

24 United States. 

25 ‘‘(c) REASONABLY INFLATED AVERAGE PROFIT.— 

26 For purposes of this chapter, with respect to any applica-
4 

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1 ble taxpayer, the reasonably inflated average profit for any 

2 taxable year is an amount equal to the average of the ad3 justed taxable income of such taxpayer for taxable years 

4 beginning during the 2000–2004 taxable year period (de5 termined without regard to the taxable year with the high6 est adjusted taxable income in such period) plus 10 per7 cent of such average. 

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

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

10 Secretary shall provide such rules as are necessary for the 

11 withholding and deposit of the tax imposed under section 

12 5896. 

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

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

15 make such returns, and furnish such information as the 

16 Secretary may by regulations prescribe. 

17 ‘‘(c) RETURN OF WINDFALL PROFIT TAX.—The Sec18 retary shall provide for the filing and the time of such 

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

20 ‘‘(d) CRUDE OIL.—The term ‘crude oil’ includes 

21 crude oil condensates and natural gasoline. 

22 ‘‘(e) BUSINESSES UNDER COMMON CONTROL.—For 

23 purposes of this chapter, all members of the same con24 trolled group of corporations (within the meaning of sec25 tion 267(f)) and all persons under common control (within 
5 

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1 the meaning of section 52(b) but determined by treating 

2 an interest of more than 50 percent as a controlling inter3 est) shall be treated as 1 person. 

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

5 such regulations as may be necessary or appropriate to 

6 carry out the purposes of this chapter.’’. 

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

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

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

‘‘CHAPTER 56. Temporary Windfall Profit on Crude Oil.’’. 

10 (c) DEDUCTIBILITY OF WINDFALL PROFIT TAX.— 

11 The first sentence of section 164(a) of the Internal Rev12 enue Code of 1986 (relating to deduction for taxes) is 

13 amended by inserting after paragraph (5) the following 

14 new paragraph: 

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

16 5896.’’. 

17 (d) HURRICANE RELIEF TRUST FUND.— 

18 (1) IN GENERAL.—Subchapter A of chapter 98 

19 of the Internal Revenue Code of 1986 (relating to 

20 trust fund code) is amended by adding at the end 

21 the following new section: 

22 ‘‘SEC. 9511. HURRICANE RELIEF TRUST FUND. 

23 ‘‘(a) ESTABLISHMENT.—There is established in the 

24 Treasury of the United States a trust fund to be known 

25 as the ‘Hurricane Relief Trust Fund’, consisting of such 
6 

•S 1809 IS

1 amounts as may be appropriated or credited to such Fund 

2 as provided in this section or section 9602(b). 

3 ‘‘(b) TRANSFERS TO FUND.—There are hereby ap4 propriated to the Hurricane Relief Trust Fund amounts 

5 equivalent to the taxes received in the Treasury under sec6 tion 5896. 

7 ‘‘(c) EXPENDITURES.—Amounts in the Hurricane 

8 Relief Trust Fund shall be available, without further ap9 propriation, to offset the supplemental spending bills that 

10 are targeted to aid victims of Hurricanes Katrina and Rita 

11 enacted after the date of the enactment of this section and 

12 before January 1, 2008. Any funds that have not been 

13 expended by December 31, 2008, shall be credited back 

14 to the General Fund as regular tax receipts.’’. 

15 (2) CLERICAL AMENDMENT.—The table of sec16 tions for such subchapter is amended by adding at 

17 the end the following new item: 

‘‘Sec. 9511. Hurricane Relief Trust Fund.’’. 

18 (e) EFFECTIVE DATES.— 

19 (1) IN GENERAL.—Except as provided in para20 graph (2), the amendments made by this section 

21 shall apply to taxable years beginning in 2005 and 

22 2006. 
7 

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1 (2) SUBSECTION (c).—The amendments made 

2 by subsection (d) shall take effect on the date of the 

3 enactment of this Act. 

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