I 

112TH CONGRESS 

1ST SESSION H. R. 1628 

To amend the Internal Revenue Code of 1986 to impose a retail tax on 

disposable carryout bags, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 15, 2011 

Mr. MORAN (for himself and Ms. NORTON) introduced the following bill; which 

was referred to the Committee on Ways and Means, and in addition to 

the Committee on Natural Resources, 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 retail tax on disposable carryout bags, 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 ‘‘Trash Reduction Act 

5 of 2011’’. 


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1 SEC. 2. IMPOSITION OF TAX ON DISPOSABLE CARRYOUT 

2 BAGS. 

3 (a) GENERAL RULE.—Chapter 31 of the Internal 

4 Revenue Code of 1986 (relating to retail excise taxes) is 

5 amended by inserting after subchapter C the following new 

6 subchapter: 

7 ‘‘Subchapter D—Disposable Carryout Bags 

‘‘Sec. 4056. Imposition of tax. 

8 ‘‘SEC. 4056. IMPOSITION OF TAX. 

9 ‘‘(a) GENERAL RULE.—There is hereby imposed on 

10 any retail sale a tax on each disposable carryout bag. 

11 ‘‘(b) AMOUNT OF TAX.—The amount of tax imposed 

12 by subsection (a) shall be $0.05 per disposable carryout 

13 bag. 

14 ‘‘(c) LIABILITY FOR TAX.—The retailer shall be liable 

15 for the tax imposed by this section. 

16 ‘‘(d) DEFINITIONS.—For purposes of this section— 

17 ‘‘(1) DISPOSABLE CARRYOUT BAG.— 

18 ‘‘(A) IN GENERAL.—The term ‘disposable 

19 carryout bag’ means a bag of any material, 

20 commonly plastic or kraft paper, which is pro21 vided to a consumer at the point of sale to 

22 carry or cover purchases, merchandise, or other 

23 items. 

24 ‘‘(B) EXCEPTIONS.—Such term does not 

25 include— 


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1 ‘‘(i) any reusable bag, 

2 ‘‘(ii) any bag manufactured for use by 

3 a customer inside a store to package bulk 

4 items such as fruit, vegetables, nuts, 

5 grains, candy, or small hardware items, 

6 such as nails and bolts, 

7 ‘‘(iii) any bag that contains or wraps 

8 frozen foods, prepared foods, or baked 

9 goods when not prepackaged, 

10 ‘‘(iv) any bag manufactured for use by 

11 a pharmacist to contain prescription drugs, 

12 and 

13 ‘‘(v) any bag manufactured to be sold 

14 at retail in packages containing multiple 

15 bags intended for use as garbage, pet 

16 waste, or yard waste bags. 

17 ‘‘(2) REUSABLE BAG.—The term ‘reusable bag’ 

18 means a bag that is— 

19 ‘‘(A)(i) made of cloth or other machine 

20 washable fabric, or 

21 ‘‘(ii) made of a durable plastic that is at 

22 least 2.25 millimeters thick, and 

23 ‘‘(B) is specifically designed and manufac24 tured for multiple use. 

25 ‘‘(e) SPECIAL RULES.— 


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1 ‘‘(1) PASS THROUGH OF TAX.—The tax im2 posed by subsection (a) shall be passed through to 

3 the customer and shall be separately stated on the 

4 receipt of sale provided to the customer. 

5 ‘‘(2) 1ST RETAIL SALE; USE TREATED AS

6 SALE.—For purposes of this section, rules similar to 

7 the rules of subsections (a) and (b) of section 4002 

8 shall apply.’’. 

9 (b) CARRYOUT BAG RECYCLING PROGRAM.—Sub10 chapter B of chapter 65 of such Code is amended by add11 ing at the end the following new section: 

12 ‘‘SEC. 6433. QUALIFIED DISPOSABLE CARRYOUT BAG RECY13 CLING PROGRAM. 

14 ‘‘(a) ALLOWANCE OF CREDIT.—If— 

15 ‘‘(1) tax has been imposed under section 4056 

16 on any disposable carryout bag, 

17 ‘‘(2) a retailer provides such bag to a customer 

18 in a point of sale transaction, 

19 ‘‘(3) such retailer has in effect at the time of 

20 such transaction a qualified carryout bag recycling 

21 program, and 

22 ‘‘(4) such retailer has kept and can produce 

23 records for purposes of this section and section 4056 

24 that include the total number of disposable carryout 

25 bags purchased and the amounts passed through to 


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1 the customer for such bags pursuant to section 

2 4056(e), 

3 the Secretary shall pay (without interest) to such retailer 

4 an amount equal to the applicable amount for each such 

5 bag used by the retailer in connection with a point of sale 

6 transaction. 

7 ‘‘(b) APPLICABLE AMOUNT.—For purposes of sub8 section (a), the applicable amount is $0.01. 

9 ‘‘(c) QUALIFIED DISPOSABLE CARRYOUT BAG RECY10 CLING PROGRAM.—For purposes of this section— 

11 ‘‘(1) IN GENERAL.—The term ‘qualified carry12 out bag recycling program’ means a recycling pro13 gram under which the retailer— 

14 ‘‘(A) to the extent the retailer provides dis15 posable carryout bags (as defined in section 

16 4056) to customers— 

17 ‘‘(i) passes through the tax imposed 

18 by section 4056 and tracks the total num19 ber of bags purchased and amount of tax 

20 passed through pursuant to section 

21 6433(a), 

22 ‘‘(ii) has printed or displayed on each 

23 such bag, in a manner clearly visible to a 

24 customer, the words ‘PLEASE RETURN 


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1 TO A PARTICIPATING STORE FOR 

2 RECYCLING’, 

3 ‘‘(iii) uses bags that are 100 percent 

4 recyclable, 

5 ‘‘(iv) uses bags that are made of high6 density polyethylene film marked with the 

7 SPI resin identification code 2 or low-den8 sity polyethylene film marked with the SPI 

9 resin identification code 4, and 

10 ‘‘(v) uses bags that contain a min11 imum of 40 percent post-consumer recycled 

12 content, 

13 ‘‘(B) places at each place of business at 

14 which retail operations are conducted one or 

15 more carryout bag collection bins which are 

16 visible, easily accessible to the customer, and 

17 clearly marked as being for the purpose of col18 lecting and recycling disposable carryout bags, 

19 ‘‘(C) recycles the disposable carryout bags 

20 collected pursuant to subparagraph (B), 

21 ‘‘(D) maintains for not less than 3 years 

22 records (which shall be available to the Sec23 retary) describing the collection, transport, and 

24 recycling of disposable carryout bags collected, 


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1 ‘‘(E) makes available to customers within 

2 the retail establishment reusable bags (as de3 fined in section 4056(c)(2)) which may be pur4 chased and used in lieu of using a disposable 

5 carryout bag, and 

6 ‘‘(F) meets the definition of 4056(d)(3). 

7 ‘‘(2) RECYCLING PROGRAM.—The term ‘recy8 cling program’ means a program that processes used 

9 materials or waste materials into new products to 

10 prevent waste of potentially useful materials; reduce 

11 raw materials consumption; reduce energy usage; re12 duce air, water, or other pollution; or reduce the 

13 need for disposal.’’. 

14 (c) ESTABLISHMENT OF TRUST FUND.—Subchapter 

15 A of chapter 98 of such Code (relating to trust fund code) 

16 is amended by adding at the end the following: 

17 ‘‘SEC. 9512. DISPOSABLE CARRYOUT BAG TRUST FUND. 

18 ‘‘(a) CREATION OF TRUST FUND.—There is estab19 lished in the Treasury of the United States a trust fund 

20 to be known as the ‘Disposable carryout bag Trust Fund’ 

21 (referred to in this section as the ‘Trust Fund’), consisting 

22 of such amounts as may be appropriated or credited to 

23 the Trust Fund as provided in this section or section 

24 9602(b). 


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1 ‘‘(b) TRANSFERS TO TRUST FUND.—There is hereby 

2 appropriated to the Trust Fund an amount equivalent to 

3 the amounts received in the Treasury pursuant to section 

4 4056. 

5 ‘‘(c) EXPENDITURES FROM TRUST FUND.—Amounts 

6 in the Trust Fund shall be available, as provided by appro7 priation Acts, for making payments under section 6433. 

8 ‘‘(d) TRANSFER TO LAND AND WATER CONSERVA9 TION FUND.— 

10 ‘‘(1) IN GENERAL.—The Secretary shall pay 

11 from time to time from the Trust Fund into the 

12 land and water conservation fund provided for in 

13 title I of the Land and Water Conservation Fund 

14 Act of 1965 amounts (as determined by the Sec15 retary) equivalent to the aggregate of the trans16 actions on which tax is imposed under section 4056 

17 aggregate amounts determined on the basis of 

18 $0.01. 

19 ‘‘(2) SPECIAL RULE REGARDING AMOUNTS

20 TRANSFERRED.—Amounts transferred to the land 

21 and water conservation fund under paragraph (1) 

22 shall not be taken into account for purposes of de23 termining amounts to be appropriated or credited to 

24 the fund under section 2(c) of the Land and Water 


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1 Conservation Fund Act of 1965 (16 U.S.C. 460l– 

2 5(c)).’’. 

3 (d) STUDY.—Not later than December 31, 2013, the 

4 Comptroller General of the United States shall conduct 

5 a study on the effectiveness of the provisions of this Act 

6 at reducing the use of disposable carryout bags and en7 couraging recycling of such bags. The report shall— 

8 (1) address measures that the Comptroller Gen9 eral determines may increase the effectiveness of 

10 such provisions, including the amount of tax im11 posed on each disposable carryout bag, and 

12 (2) any effects, both positive and negative, on 

13 any United States businesses. The Comptroller Gen14 eral shall submit a report of such study to the Com15 mittee on Ways and Means of the House of Rep16 resentatives and the Committee on Finance of the 

17 Senate. 

18 (e) CLERICAL AMENDMENTS.— 

19 (1) The table of subchapters for chapter 31 of 

20 such Code is amended by inserting after the item re21 lating to adding at the end thereof the following new 

22 item: 

‘‘Subchapter D. Disposable carryout bags.’’. 


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1 (2) The table of sections for subchapter B of 

2 chapter 65 of such Code is amended by adding at 

3 the end the following new item: 

‘‘Sec. 6433. Qualified disposable carryout bag recycling program.’’. 

4 (3) The table of sections for subchapter A of 

5 chapter 98 of such Code is amended by adding at 

6 the end the following new item: 

‘‘Sec. 9512. Disposable carryout bag trust fund.’’. 

7 (f) EFFECTIVE DATE.—The amendments made by 

8 this section shall take effect on January 1, 2011. 

Æ 


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