I 

114TH CONGRESS 

1ST SESSION H. R. 309 

To amend the Internal Revenue Code of 1986 to provide for repealing the 

gas tax and establishing a carbon tax on highway fuels, and for other 

purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 13, 2015 

Mr. HUFFMAN introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committee on Energy 

and Commerce, 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 provide 

for repealing the gas tax and establishing a carbon tax 

on highway fuels, 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 ‘‘Gas Tax Replacement 

5 Act of 2015’’. 


SSpencer on DSK4SPTVN1PROD with BILLS
2 

•HR 309 IH

1 SEC. 2. REPEAL OF EXCISE TAX ON GASOLINE AND DIESEL 

2 FUEL. 

3 (a) MANUFACTURERS TAX.—Section 4081(a)(2)(A) 

4 of the Internal Revenue Code of 1986 is amended— 

5 (1) in clause (i) by striking ‘‘18.3 cents per gal6 lon’’ and inserting ‘‘0 cents per gallon’’, and 

7 (2) in clause (ii) by striking ‘‘24.3 cents per 

8 gallon’’ and inserting ‘‘0 cents per gallon’’. 

9 (b) RETAIL TAX.—Section 4041(a) of the Internal 

10 Revenue Code of 1986 is amended by striking paragraph 

11 (1). 

12 (c) CONFORMING AMENDMENTS.— 

13 (1) Section 4081 of the Internal Revenue Code 

14 of 1986 is amended— 

15 (A) in subsection (a)(2) by striking sub16 paragraph (D), 

17 (B) by striking subsection (c), and 

18 (C) in subsection (d) by striking paragraph 

19 (1). 

20 (2) Section 4041 of the Internal Revenue Code 

21 of 1986 is amended— 

22 (A) by amending the heading of subsection 

23 (a) to read as follows: ‘‘SPECIAL MOTOR

24 FUELS’’, and 

25 (B) in subsection (a)(2)(B)(i) by striking 

26 ‘‘the rate of tax specified in section 


SSpencer on DSK4SPTVN1PROD with BILLS
3 

•HR 309 IH

1 4081(a)(2)(A)(i) which is in effect at the time 

2 of such sale or use,’’ and inserting ‘‘18.3 cents 

3 per gallon’’. 

4 (d) EFFECTIVE DATE.—The amendments made by 

5 this section shall apply to fuel sold or used after December 

6 31, 2016. 

7 SEC. 3. CARBON TAX ON HIGHWAY FUELS. 

8 (a) IN GENERAL.—Paragraph (1) of section 4611(c) 

9 of the Internal Revenue Code of 1986 is amended by strik10 ing ‘‘and’’ at the end of subparagraph (A), by striking 

11 the period at the end of subparagraph (B) and inserting 

12 ‘‘, and’’, and by inserting after subparagraph (B) the fol13 lowing new subparagraph: 

14 ‘‘(C) the carbon dioxide equivalent rate.’’. 

15 (b) RATES.— 

16 (1) IN GENERAL.—Paragraph (2) of section 

17 4611(c) of the Internal Revenue Code of 1986 is 

18 amended by striking ‘‘and’’ at the end of subpara19 graph (A), by striking the period at the end of sub20 paragraph (B) and inserting ‘‘, and’’, and by insert21 ing after subparagraph (B) the following new sub22 paragraph: 

23 ‘‘(C) the carbon dioxide equivalent rate 

24 is— 


SSpencer on DSK4SPTVN1PROD with BILLS
4 

•HR 309 IH

1 ‘‘(i) $50 per metric ton (or portion 

2 thereof) of total life-cycle emissions of car3 bon dioxide, and 

4 ‘‘(ii) an equivalent amount per metric 

5 ton (or portion thereof) of total life-cycle 

6 emissions of any other greenhouse gas de7 termined on a ratio of the amount such 

8 other greenhouse gas per metric ton as the 

9 amount of carbon dioxide per metric ton, 

10 in the crude oil or petroleum product (as the 

11 case may be) subject to tax under subsection 

12 (a) which is to be refined into gasoline or diesel 

13 fuel. 

14 For purposes of subparagraph (C), total life-cycle 

15 emissions of carbon dioxide and other greenhouse 

16 gases shall be determined by the Administrator of 

17 the Environmental Protection Agency pursuant to 

18 section 4 of the Gas Tax Replacement Act of 

19 2015.’’. 

20 (2) ADJUSTMENT FOR INFLATION.—Section 

21 4611(c) of the Internal Revenue Code of 1986 is 

22 amended by adding at the end the following: 

23 ‘‘(3) CARBON DIOXIDE EQUIVALENT RATE IN24 FLATION ADJUSTMENT.— 


SSpencer on DSK4SPTVN1PROD with BILLS
5 

•HR 309 IH

1 ‘‘(A) IN GENERAL.—In the case of any cal2 endar year after 2015, the dollar amount in 

3 paragraph (2)(C) shall be increased by an 

4 amount equal to— 

5 ‘‘(i) such dollar amount, multiplied by 

6 ‘‘(ii) the cost-of-living adjustment de7 termined under section 1(f)(3) for the cal8 endar year, determined by substituting 

9 ‘‘calendar year 2014’’ for ‘‘calendar year 

10 1992’’ in subparagraph (B) thereof. 

11 ‘‘(B) ROUNDING.—If any amount as in12 creased under subparagraph (A) is not a mul13 tiple of $1, such amount shall be rounded to the 

14 nearest multiple of $1.’’. 

15 (c) ALTERNATIVE FUELS PRODUCER EXCISE TAX.— 

16 (1) IN GENERAL.—Subchapter A of chapter 38 

17 of the Internal Revenue Code of 1986 is amended by 

18 inserting after section 4611 the following: 

19 ‘‘SEC. 4611A. CERTAIN ALTERNATIVE FUELS. 

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

21 tax at the rate specified in subsection (b) on— 

22 ‘‘(1) methanol, ethanol, and biodiesel produced 

23 in the United States by the producer thereof, and 


SSpencer on DSK4SPTVN1PROD with BILLS
6 

•HR 309 IH

1 ‘‘(2) methanol, ethanol, and biodiesel, and any 

2 blended product thereof, entered into the United 

3 States for consumption, use, or warehousing. 

4 ‘‘(b) RATE OF TAX.—The rate of the tax imposed by 

5 this section is— 

6 ‘‘(1) $50 per metric ton (or portion thereof) of 

7 total life-cycle emissions of carbon dioxide, and 

8 ‘‘(2) an equivalent amount per metric ton (or 

9 portion thereof) of total life-cycle emissions of any 

10 other greenhouse gas determined on a ratio of the 

11 amount such other greenhouse gas per metric ton as 

12 the amount of carbon dioxide per metric ton, 

13 in methanol, ethanol, and biodiesel, and any blended prod14 uct thereof, produced or entered into in the United States. 

15 For purposes of the preceding sentence, total life-cycle 

16 emissions of carbon dioxide and other greenhouse gases 

17 shall be determined by the Administrator of the Environ18 mental Protection Agency pursuant to section 4 of the Gas 

19 Tax Replacement Act of 2015. 

20 ‘‘(c) PERSONS LIABLE FOR TAX.— 

21 ‘‘(1) UNITED STATES PRODUCTION.—The tax 

22 imposed by subsection (a)(1) shall be paid by the 

23 producer of the product on which such tax is im24 posed. 


SSpencer on DSK4SPTVN1PROD with BILLS
7 

•HR 309 IH

1 ‘‘(2) IMPORTED PRODUCTS.—The tax imposed 

2 by subsection (a)(2) shall be paid by the person en3 tering the product for consumption, use, or 

4 warehousing.’’. 

5 (2) CLERICAL AMENDMENT.—The table of sec6 tions for subchapter A of chapter 38 of the Internal 

7 Revenue Code of 1986 is amended by inserting after 

8 the item relating to section 4611 the following new 

9 item: 

‘‘Sec. 4611A. Certain alternative fuels.’’. 

10 (d) CREDITS AND PAYMENTS FOR NONTAXABLE

11 USES.— 

12 (1) GASOLINE USED ON FARMS.—Section 6420 

13 of the Internal Revenue Code of 1986 is amended by 

14 inserting after subsection (g) the following: 

15 ‘‘(h) SPECIAL RULE FOR CARBON DIOXIDE EQUIVA16 LENT RATE OF TAX.—For purposes of this section, a gal17 lon of gasoline refined from a barrel of crude oil or petro18 leum product on which tax was imposed under section 

19 4611 at the carbon dioxide equivalent rate under sub20 section (c)(1)(C) thereof and used for a purpose described 

21 in subsection (a)— 

22 ‘‘(1) shall be treated as a gallon of gasoline to 

23 which this section applies, and 

24 ‘‘(2) the rate at which tax was imposed under 

25 section 4611 with respect to such gallon shall be the 


SSpencer on DSK4SPTVN1PROD with BILLS
8 

•HR 309 IH

1 same fraction of so much of the tax imposed under 

2 section 4611 as is attributable to subsection 

3 (c)(1)(C) thereof on such barrel as the fraction of 

4 such gallon of gas is of the whole barrel.’’. 

5 (2) GASOLINE USED FOR CERTAIN NON6 HIGHWAY PURPOSES, ETC.—Section 6421 of the In7 ternal Revenue Code of 1986 is amended by redesig8 nating subsection (j) as subsection (k) and by insert9 ing after subsection (i) the following: 

10 ‘‘(j) SPECIAL RULE FOR CARBON DIOXIDE EQUIVA11 LENT RATE OF TAX.—For purposes of this section, in the 

12 case of a gallon of gasoline refined from a barrel of crude 

13 oil or petroleum product on which tax was imposed under 

14 section 4611 at the carbon dioxide equivalent rate under 

15 subsection (c)(1)(C) thereof— 

16 ‘‘(1) if such gallon is used for a purpose de17 scribed in subsection (a) or (b) or is sold for a pur18 pose described in subsection (c), such gallon shall be 

19 treated as a gallon of gasoline to which this section 

20 applies, and 

21 ‘‘(2) the rate at which tax was imposed under 

22 section 4611 with respect to such gallon shall be the 

23 same fraction of so much of the tax imposed under 

24 section 4611 as is attributable to subsection 


SSpencer on DSK4SPTVN1PROD with BILLS
9 

•HR 309 IH

1 (c)(1)(C) thereof on such barrel as the fraction of 

2 such gallon of gas is of the whole barrel.’’. 

3 (3) CREDIT FOR ALCOHOL FUEL, BIODIESEL, 

4 AND ALTERNATIVE FUEL MIXTURES.—Section 

5 6426(a) of the Internal Revenue Code of 1986 is 

6 amended by striking ‘‘and’’ at the end of paragraph 

7 (1), by striking the period at the end of paragraph 

8 (2) and inserting a comma, and by inserting after 

9 paragraph (2) the following: 

10 ‘‘(3) against so much of the tax imposed by sec11 tion 4611 as is attributable to the carbon dioxide 

12 equivalent rate of tax under subsection (c)(1)(C) an 

13 amount equal to the credit described in subsection 

14 (c), determined on the same fraction of the amount 

15 of such tax as the number of gallons of diesel used 

16 by the taxpayer in producing any biodiesel mixture 

17 for sale or use in a trade or business of the tax18 payer, and 

19 ‘‘(4) against the tax imposed by section 4611A 

20 an amount equal to the sum of the credits described 

21 in subsections (b), (c), and (e), determined on the 

22 same fraction of the amount of such tax as the num23 ber of gallons of alcohol, biodiesel, or alternative fuel 

24 used by the taxpayer in producing any fuel mixture 

25 of taxable fuel.’’. 


SSpencer on DSK4SPTVN1PROD with BILLS
10 

•HR 309 IH

1 (4) FUELS NOT USED FOR TAXABLE PUR2 POSES.—Section 6427 of the Internal Revenue Code 

3 of 1986 is amended by redesignating subsection (p) 

4 as subsection (q) and by inserting after subsection 

5 (o) the following: 

6 ‘‘(p) SPECIAL RULE FOR CARBON DIOXIDE EQUIVA7 LENT RATE.—For purposes of this section, in the case of 

8 a gallon of fuel refined from a barrel of crude oil or petro9 leum product on which tax was imposed under section 

10 4611 at the carbon dioxide equivalent rate of tax under 

11 subsection (c)(1)(C) thereof, or produced from methanol, 

12 ethanol, or biodiesel on which tax was imposed under sec13 tion 4611A, if the sale or use of such fuel would give rise 

14 to a payment under this section but for the fact that such 

15 fuel was taxed under section 4611 or 4611A and not sec16 tion 4041 or 4081— 

17 ‘‘(1) this section shall be applied as if such fuel 

18 had been taxed under section 4041 or 4081, and 

19 ‘‘(2) the rate at which tax was imposed under 

20 section 4611 or 4611A with respect to such fuel 

21 shall be— 

22 ‘‘(A) in the case of tax imposed under sec23 tion 4611(c)(1)(C), the same fraction of such 

24 tax on such barrel as the fraction of a gallon 

25 of such fuel is of the whole barrel, and 


SSpencer on DSK4SPTVN1PROD with BILLS
11 

•HR 309 IH

1 ‘‘(B) in the case of tax imposed under sec2 tion 4611A, the same fraction of the amount of 

3 such tax as the amount of fuel giving rise to a 

4 payment under this section.’’. 

5 (e) EFFECTIVE DATE.—The amendments made by 

6 this section shall take effect on January 1, 2015. 

7 SEC. 4. LIFE-CYCLE EMISSIONS. 

8 (a) CARBON DIOXIDE EMISSIONS REPORT.—Not 

9 later than the first January 1st occurring at least 1 year 

10 after the date of enactment of this Act, the Administrator 

11 shall transmit to the Internal Revenue Service and make 

12 public a report on the total life-cycle emissions of carbon 

13 dioxide for each covered transportation fuel, expressed in 

14 tons of carbon dioxide emissions per barrel of fuel or an 

15 appropriate alternate measure. Such report shall take into 

16 account the differences in carbon dioxide emissions per 

17 barrel of fuel across different regions and countries due 

18 to means of resource extraction and production, transpor19 tation, and other factors, with each covered transportation 

20 fuel being as regionally specific as determined by the Ad21 ministrator. 

22 (b) ADDITION OF COVERED TRANSPORTATION

23 FUEL.—The Administrator shall— 

24 (1) from time to time determine which trans25 portation fuels have achieved a sufficient share of 


SSpencer on DSK4SPTVN1PROD with BILLS
12 

•HR 309 IH

1 the on-road transportation fuel market to warrant 

2 being considered a covered transportation fuel, and 

3 (2) update the report transmitted under sub4 section (a), and transmit such updated report to 

5 Congress, with the specifications on the total life6 cycle emissions of carbon dioxide and other green7 house gases for each fuel newly determined under 

8 paragraph (1) to be considered a covered transpor9 tation fuel. 

10 (c) DEFINITIONS.—In this section: 

11 (1) ADMINISTRATOR.—The term ‘‘Adminis12 trator’’ means the Administrator of the Environ13 mental Protection Agency. 

14 (2) BIOFUEL.—The term ‘‘biofuel’’ means the 

15 biofuel component of a transportation fuel. 

16 (3) COVERED TRANSPORTATION FUEL.—The 

17 term ‘‘covered transportation fuel’’ means gasoline, 

18 diesel fuel, biofuel, and any other fuel the Adminis19 trator determines has achieved a sufficient share of 

20 the on-road transportation fuel market to warrant 

21 regulation under this section. 

22 (4) GREENHOUSE GAS.—The term ‘‘greenhouse 

23 gas’’ has the same meaning given the term in sec24 tion 211(o)(1) of the Clean Air Act (42 U.S.C. 

25 7545(o)(1)). 


SSpencer on DSK4SPTVN1PROD with BILLS
13 

•HR 309 IH

1 (5) LIFE-CYCLE EMISSIONS.—The term ‘‘life2 cycle emissions’’ means emissions from all activities 

3 included in the production, transport, storage, and 

4 use of a fuel, including land use changes, means of 

5 resource extraction and production, transportation 

6 systems, and leakages. 

Æ 


SSpencer on DSK4SPTVN1PROD with BILLS