II 

119TH CONGRESS 

1ST SESSION S. 25 

To impose an assessment related to fossil fuel emissions, to establish the 

Polluters Pay Climate Fund, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 7, 2025 

Mr. VAN HOLLEN (for himself, Mr. SANDERS, Mr. MERKLEY, Mr. MARKEY, 

and Ms. WARREN) introduced the following bill; which was read twice and 

referred to the Committee on Finance 

A BILL 

To impose an assessment related to fossil fuel emissions, 

to establish the Polluters Pay Climate Fund, 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 ‘‘Polluters Pay Climate 

5 Fund Act of 2025’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds that— 

8 (1) climate change, resulting primarily from the 

9 combustion of fossil fuels, is an immediate, grave 


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1 threat to the communities, environment, and econ2 omy of the United States; 

3 (2) severe consequences of climate change have 

4 already materialized in the United States, including 

5 rising sea levels, increasing temperatures, extreme 

6 weather events, flooding, heat waves, loss of bio7 diversity, and other climate change-driven ecosystem 

8 threats; 

9 (3) the Federal government jointly with States 

10 and localities must develop and implement protective 

11 measures to counteract the adverse effects of climate 

12 change, protect communities, and build resilience to 

13 extreme weather; 

14 (4) the government response must include pro15 tections for communities that are most vulnerable to 

16 climate change impacts, especially communities of 

17 color, low-income communities, and Tribal and In18 digenous communities that are also more likely to 

19 have experienced systemic disinvestment and be 

20 overburdened by fossil fuel pollution; 

21 (5) the protective measures necessary to re22 spond to the adverse effects of climate change in the 

23 United States will require trillions of dollars of new 

24 investment during the decade after the date of en25 actment of this Act; 


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1 (6) climate change related extreme weather 

2 events, such as those described in paragraph (2), 

3 cost the United States at least $150,000,000,000 

4 each year and disproportionately affect underserved 

5 and overburdened communities, according to the 

6 Fifth National Climate Assessment; 

7 (7) the $100,000,000,000 each year that fossil 

8 fuel companies are collectively assessed for the Pol9 luters Pay Climate Fund established in this Act rep10 resents only a small portion of the total cost to the 

11 Federal government to respond to climate change re12 lated extreme weather events and make needed cli13 mate change adaptation and resilience investments; 

14 (8) peer-reviewed research can now determine 

15 with great accuracy the share of carbon dioxide re16 leased into the atmosphere by the operations and 

17 products of specific fossil fuel companies, which is 

18 what informs the formulas to determine carbon diox19 ide emissions that are used in the amendments made 

20 by this Act; 

21 (9) the fossil fuel industry has been aware of 

22 the central role that their product plays in causing 

23 climate change since before the year 2000; 


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1 (10) the fossil fuel industry must now increase 

2 their contribution to government expenditures to 

3 protect the Nation from climate disaster; and 

4 (11) this Act and assessments under the 

5 amendments made by this Act are not intended— 

6 (A) to be a determination of fault; or 

7 (B) to have any impact on the ability of 

8 any person or other government to hold pol9 luters accountable for harms caused. 

10 SEC. 3. TAX RELATING TO CURRENT STOCK OF GREEN11 HOUSE GAS EMISSIONS. 

12 (a) IN GENERAL.—Chapter 38 of the Internal Rev13 enue Code of 1986 is amended by adding at the end the 

14 following new subchapter: 

15 ‘‘Subchapter E—Certain Fossil Fuel 

16 Emissions 

‘‘Sec. 4691. Imposition of tax. 

17 ‘‘SEC. 4691. IMPOSITION OF TAX. 

18 ‘‘(a) IMPOSITION.—Each assessable person shall pay 

19 to the Secretary of the Treasury not later than the appli20 cable payment date a tax in an amount determined under 

21 subsection (b). 

22 ‘‘(b) DETERMINATION OF AMOUNT.— 

23 ‘‘(1) IN GENERAL.—With respect to each as24 sessable person, the tax under this section shall be 


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1 equal to an amount that bears the same ratio to 

2 $1,000,000,000,000 as— 

3 ‘‘(A) the assessable person’s applicable 

4 share of covered carbon dioxide emissions taken 

5 into account under this section, bears to 

6 ‘‘(B) the aggregate applicable shares of 

7 covered carbon dioxide emissions of all assess8 able persons taken into account under this sec9 tion. 

10 ‘‘(2) DETERMINATION OF APPLICABLE

11 SHARE.— 

12 ‘‘(A) IN GENERAL.—The applicable share 

13 of covered carbon dioxide emissions taken into 

14 account under this section for any assessable 

15 person shall be the excess (if any) of— 

16 ‘‘(i) the covered carbon dioxide emis17 sions attributable to such person (deter18 mined in metric tons), as determined by 

19 the Secretary based on product-related car20 bon dioxide emissions of such person, over 

21 ‘‘(ii) 1,000,000,000 metric tons. 

22 ‘‘(B) ADJUSTMENT.—The Secretary may 

23 adjust the amount determined under subpara24 graph (A)(i) with respect to an assessable per25 son who is described in subsection (c)(2)(B)(ii) 


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1 (or who is a successor in interest to a person 

2 described in such subsection) if such person es3 tablishes to the satisfaction of the Secretary 

4 that a portion of such amount was— 

5 ‘‘(i) attributable to the extraction of 

6 crude oil by another assessable person who 

7 is described in subsection (c)(2)(B)(i) (or a 

8 successor in interest to a person described 

9 in such subsection), and 

10 ‘‘(ii) taken into account in deter11 mining such amount for such other assess12 able person. 

13 ‘‘(c) ASSESSABLE PERSON.—For purposes of this 

14 section— 

15 ‘‘(1) IN GENERAL.—The term ‘assessable per16 son’ means— 

17 ‘‘(A) any person that is described in para18 graph (2), or 

19 ‘‘(B) any successor in interest to a person 

20 described in paragraph (2). 

21 ‘‘(2) PERSON DESCRIBED.—A person is de22 scribed in this paragraph if such person— 

23 ‘‘(A) is a United States person or is en24 gaged in a trade or business within the United 

25 States during the period beginning on the date 


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1 of the enactment of this Act and ending on De2 cember 31, 2025, 

3 ‘‘(B) during any part of the covered pe4 riod, was engaged in the trade or business of— 

5 ‘‘(i) extracting any fossil fuel, or 

6 ‘‘(ii) refining any crude oil, and 

7 ‘‘(C) is determined by the Secretary to be 

8 responsible for more than 1,000,000,000 metric 

9 tons of covered carbon dioxide emissions. 

10 ‘‘(3) CONTROLLED GROUPS.— 

11 ‘‘(A) IN GENERAL.—For purposes of this 

12 subsection, all persons treated as a single em13 ployer under subsection (a) or (b) of section 52 

14 or subsection (m) or (o) of section 414 shall be 

15 treated as a single assessable person. 

16 ‘‘(B) INCLUSION OF FOREIGN CORPORA17 TIONS.—For purposes of subparagraph (A), in 

18 applying subsections (a) and (b) of section 52 

19 to this section, section 1563 shall be applied 

20 without regard to subsection (b)(2)(C) thereof. 

21 ‘‘(4) JOINT AND SEVERAL LIABILITY.—If more 

22 than one person is liable for payment of the tax 

23 under subsection (a) with respect to a single assess24 able person by reason of the application of paraVerDate Sep 11 2014 02:57 Jan 31, 2025 Jkt 059200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S25.IS S25

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1 graph (3), all such persons shall be jointly and sev2 erally liable for payment of such tax. 

3 ‘‘(d) OTHER DEFINITIONS AND RULES.—For pur4 poses of this section— 

5 ‘‘(1) APPLICABLE PAYMENT DATE.—The term 

6 ‘applicable payment date’ means September 30, 

7 2026. 

8 ‘‘(2) COVERED CARBON DIOXIDE EMISSIONS.— 

9 The term ‘covered carbon dioxide emissions’ means, 

10 with respect to any person, the total quantity of car11 bon dioxide released into the atmosphere during the 

12 covered period by reason such person engaging in 

13 the trade or business of extracting fossil fuels or of 

14 refining crude oil. 

15 ‘‘(3) COVERED PERIOD.—The term ‘covered pe16 riod’ means the period that— 

17 ‘‘(A) began on January 1, 2000, and 

18 ‘‘(B) ended on December 31, 2023. 

19 ‘‘(4) FOSSIL FUEL.—The term ‘fossil fuel’ 

20 means coal, crude oil, and fuel gases. 

21 ‘‘(5) COAL.—The term ‘coal’ means anthracite, 

22 bituminous, subbituminous, and lignite coal. 

23 ‘‘(6) CRUDE OIL.—The term ‘crude oil’ means 

24 oil or petroleum of any kind and in any form, includ25 ing bitumen, oil sands, heavy oil, conventional and 


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1 unconventional oil, shale oil, natural gas liquids, con2 densates, and related fossil fuel liquids. 

3 ‘‘(7) FUEL GASES.—The term ‘fuel gases’ 

4 means natural gas, associated natural gas, conven5 tional and unconventional gas, shale gas, and related 

6 methane gas production. 

7 ‘‘(8) DETERMINATION OF CARBON DIOXIDE

8 EMISSIONS.—In determining the amount of carbon 

9 dioxide emissions with respect to any assessable per10 son— 

11 ‘‘(A) an amount equivalent to 942.5 metric 

12 tons of carbon dioxide shall be treated as re13 leased for every 1,000,000 pounds of coal, 

14 ‘‘(B) an amount equivalent to 432,180 

15 metric tons of carbon dioxide shall be treated as 

16 released for every 1,000,000 barrels of crude 

17 oil, and 

18 ‘‘(C) an amount equivalent to 54,440 met19 ric tons of carbon dioxide shall be treated as re20 leased for every 1,000,000,000 cubic feet of fuel 

21 gases. 

22 ‘‘(e) ELECTION TO PAY LIABILITY IN INSTALL23 MENTS.— 


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1 ‘‘(1) IN GENERAL.—An assessable person may 

2 elect to pay the tax under this section in 9 annual 

3 installments of the following amounts: 

4 ‘‘(A) 20 percent of the tax under this sec5 tion in the case of the first installment. 

6 ‘‘(B) 10 percent of the tax under this sec7 tion in each of the following 8 installments. 

8 ‘‘(2) DATE FOR PAYMENT OF INSTALLMENTS.— 

9 If an election is made under paragraph (1), the first 

10 installment shall be paid on the applicable payment 

11 date and each succeeding installment shall be paid 

12 on the same date as the applicable payment date for 

13 each calendar year following the calendar year with 

14 respect to which the preceding installment was 

15 made. 

16 ‘‘(3) ACCELERATION OF PAYMENT.—If there is 

17 an addition to tax for failure to timely pay any in18 stallment required under this subsection, a liquida19 tion or sale of substantially all the assets of the as20 sessable person (including in a title 11 or similar 

21 case), a cessation of business by the assessable per22 son, or any similar circumstance, then the unpaid 

23 portion of all remaining installments shall be due on 

24 the date of such event (or in the case of a title 11 

25 or similar case, the day before the petition is filed). 


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1 The preceding sentence shall not apply to the sale 

2 of substantially all the assets of an assessable person 

3 to a buyer if such buyer enters into an agreement 

4 with the Secretary under which such buyer is liable 

5 for the remaining installments due under this sub6 section in the same manner as if such buyer were 

7 the assessable person. 

8 ‘‘(4) PRORATION OF DEFICIENCY TO INSTALL9 MENTS.—If an election is made under paragraph (1) 

10 to pay the tax under this section in installments and 

11 a deficiency has been assessed with respect to such 

12 tax, the deficiency shall be prorated to the install13 ments payable under paragraph (1). The part of the 

14 deficiency so prorated to any installment the date 

15 for payment of which has not arrived shall be col16 lected at the same time as, and as a part of, such 

17 installment. The part of the deficiency so prorated 

18 to any installment the date for payment of which 

19 has arrived shall be paid upon notice and demand 

20 from the Secretary. This subsection shall not apply 

21 if the deficiency is due to negligence, to intentional 

22 disregard of rules and regulations, or to fraud with 

23 intent to evade tax. 

24 ‘‘(5) ELECTION.—Any election under paragraph 

25 (1) shall be made not later than the applicable payVerDate Sep 11 2014 02:57 Jan 31, 2025 Jkt 059200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S25.IS S25

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1 ment date and shall be made in such manner as the 

2 Secretary shall provide. 

3 ‘‘(6) INSTALLMENTS NOT TO PREVENT CREDIT

4 OR REFUND OF OVERPAYMENTS OR INCREASE ESTI5 MATED TAXES.—If an election is made under para6 graph (1) to pay the tax under this section in in7 stallments— 

8 ‘‘(A) no installment of such tax shall— 

9 ‘‘(i) in the case of a request for credit 

10 or refund, be taken into account as a li11 ability for purposes of determining whether 

12 an overpayment exists for purposes of sec13 tion 6402 before the date on which such 

14 installment is due, or 

15 ‘‘(ii) for purposes of sections 6425, 

16 6654, and 6655, be treated as a tax im17 posed by section 1, section 11, or sub18 chapter L of chapter 1, and 

19 ‘‘(B) the first sentence of section 6403 

20 shall not apply with respect to any such install21 ment. 

22 ‘‘(f) REGULATIONS.—Not later than 18 months after 

23 the date of enactment of this section, the Secretary shall 

24 promulgate such regulations as are necessary to carry out 

25 this section.’’. 


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1 (b) NO DEDUCTION.—Section 275(a) of such Code 

2 is amended by adding at the end the following new para3 graph: 

4 ‘‘(7) Taxes imposed by subchapter E of chapter 

5 38.’’. 

6 (c) CLERICAL AMENDMENT.—The table of sub7 chapters for chapter 38 of such Code is amended by add8 ing at the end the following new item: 

‘‘SUBCHAPTER E—CERTAIN FOSSIL FUEL EMISSIONS’’. 

9 SEC. 4. POLLUTER PAYS CLIMATE CHANGE FUND. 

10 (a) ESTABLISHMENT OF FUND.— 

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

12 of the Internal Revenue Code of 1986 is amended by 

13 adding at the end the following new section: 

14 ‘‘SEC. 9512. POLLUTERS PAY CLIMATE FUND. 

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

16 Treasury of the United States a trust fund, to be known 

17 as the ‘Polluters Pay Climate Fund’ (hereinafter in this 

18 section referred to as the ‘Fund’), consisting of amounts 

19 as are appropriated or credited to such Trust Fund as 

20 provided in this section and section 9602(b). 

21 ‘‘(b) TRANSFERS.—There are hereby appropriated to 

22 the Fund amounts equivalent to the taxes received in the 

23 Treasury under section 4691. 

24 ‘‘(c) EXPENDITURES FROM THE FUND.—Amounts in 

25 the fund shall be available, as provided in appropriations 


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1 Acts, for the purpose of making expenditures to carry out 

2 the purposes of section 4(b) of the Polluters Pay Climate 

3 Fund Act of 2025.’’. 

4 (2) CLERICAL AMENDMENT.—The table of sec5 tions for subchapter A of chapter 98 of such Code 

6 is amended by adding at the end the following new 

7 item: 

‘‘Sec. 9512. Polluters Pay Climate Fund.’’. 

8 (b) EXPENDITURES FROM FUND.— 

9 (1) DEFINITIONS.—In this subsection: 

10 (A) ADMINISTRATOR.—The term ‘‘Admin11 istrator’’ means the Administrator of the Envi12 ronmental Protection Agency. 

13 (B) ENVIRONMENTAL JUSTICE COMMU14 NITY.—The term ‘‘environmental justice com15 munity’’ means a community with significant 

16 representation of communities of color, low-in17 come communities, or Tribal and Indigenous 

18 communities that experiences, or is at risk of 

19 experiencing, higher or more adverse human 

20 health or environmental effects as compared to 

21 other communities. 

22 (C) FUND.—The term ‘‘Fund’’ means the 

23 Polluters Pay Climate Change Fund established 

24 under section 9512 of the Internal Revenue 

25 Code of 1986. 


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1 (D) SECRETARY.—The term ‘‘Secretary’’ 

2 means the Secretary of the Treasury. 

3 (2) USE OF FUND AMOUNTS.— 

4 (A) GENERAL PURPOSES.—The Secretary, 

5 in consultation with the Administrator and the 

6 heads of other relevant agencies, shall use 

7 amounts in the Fund for the purposes of fur8 thering a comprehensive and equitable Federal 

9 response to climate change impacts through in10 vestments in climate resilience, adaptation, dis11 aster response, and environmental justice, in12 cluding— 

13 (i) climate-related disaster recovery 

14 and mitigation support; 

15 (ii) climate change adaptation support 

16 through climate and disaster planning as17 sistance, funding for climate-resilient infra18 structure, and improved climate and ex19 treme weather prediction capabilities; 

20 (iii) initiatives that increase the cli21 mate resilience of energy systems through 

22 energy efficiency, grid resilience, and dis23 tributed electricity generation initiatives; 

24 (iv) initiatives that increase the cli25 mate resilience of the food system through 


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1 support for climate-resilient farming prac2 tices; 

3 (v) initiatives that increase the cli4 mate resilience of the transportation sys5 tem through planning and climate change 

6 adaptation support; 

7 (vi) initiatives that increase the cli8 mate resilience of ecosystems through con9 servation, restoration, and wildfire man10 agement activities; 

11 (vii) support for climate-related public 

12 health initiatives, including efforts to ad13 dress extreme heat; and 

14 (viii) initiatives that increase the cli15 mate resiliency of drinking water and 

16 stormwater infrastructure. 

17 (B) SPECIFIED USES.—In carrying out 

18 subparagraph (A) each fiscal year and to the 

19 greatest extent practicable, the Secretary shall 

20 use amounts in the Fund— 

21 (i) to provide funding of not less than 

22 $15,000,000,000 to the Federal Emer23 gency Management Agency for response 

24 and resilience programs of the Federal 

25 Emergency Management Agency to adVerDate Sep 11 2014 02:57 Jan 31, 2025 Jkt 059200 PO 00000 Frm 00016 Fmt 6652 Sfmt 6201 E:\BILLS\S25.IS S25

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1 dress climate-related disasters, including 

2 hurricanes, flooding, extreme heat, and 

3 wildfires, of which not less than 

4 $3,000,000,000 shall be used to carry out 

5 the Building Resilient Infrastructure and 

6 Communities program under section 203 

7 of the Robert T. Stafford Disaster Relief 

8 and Emergency Assistance Act (42 U.S.C. 

9 5133); and 

10 (ii) to provide funding of not less than 

11 $6,000,000,000 for grants and technical 

12 assistance under section 138 of the Clean 

13 Air Act (42 U.S.C. 7438), subject to the 

14 condition that the Administrator may de15 termine the appropriate amounts to be 

16 used for those grants and that technical 

17 assistance. 

18 (C) ENVIRONMENTAL JUSTICE SET

19 ASIDE.—Of the amounts appropriated from the 

20 Fund each fiscal year, 40 percent shall be used 

21 for investments that benefit environmental jus22 tice communities. 

23 (D) SELECTION.—For the purpose of de24 termining how to award amounts appropriated 

25 from the Fund in excess of the amounts reVerDate Sep 11 2014 02:57 Jan 31, 2025 Jkt 059200 PO 00000 Frm 00017 Fmt 6652 Sfmt 6201 E:\BILLS\S25.IS S25

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1 quired to be used under subparagraph (B), the 

2 Secretary, in coordination with the Adminis3 trator and the heads of other relevant agencies, 

4 shall establish selection criteria, which shall give 

5 the highest priority to projects or other activi6 ties that are most impactful in achieving the 

7 purposes described in subparagraph (A), as de8 termined by the Secretary, in coordination with 

9 the Administrator and the heads of other rel10 evant agencies. 

11 SEC. 5. AVAILABILITY OF REMEDIES. 

12 (a) IN GENERAL.—Nothing in this Act or the amend13 ments made by this Act shall be construed to relieve any 

14 person from liability at common law or under any State 

15 or Federal law. 

16 (b) EFFECT ON CLAIMS RELATED TO CLIMATE

17 CHANGE.—Nothing in this Act or the amendments made 

18 by this Act, the Clean Air Act (42 U.S.C. 7401 et seq.), 

19 or Federal common law preempts, displaces, or restricts 

20 any right or remedy of any person, State, unit of local 

21 government, or Tribal government under any State or 

22 local law (including common law) relating to an allegation 

23 of— 

24 (1) deception concerning the effects of fossil 

25 fuel on climate change; 


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1 (2) damage or injury resulting from the role of 

2 fossil fuel in contributing to climate change; or 

3 (3) the failure to avoid damage or injury re4 lated to climate change, including claims for nui5 sance, trespass, design defect, negligence, failure to 

6 warn, or deceptive or unfair practices and claims for 

7 injunctive, declaratory, monetary, or other relief. 

8 (c) RULE OF CONSTRUCTION.—Nothing in this Act 

9 or the amendments made by this Act shall— 

10 (1) require the repayment of any funds made 

11 available from the Polluter Pays Climate Change 

12 Fund established under section 9512 of the Internal 

13 Revenue Code of 1986 and used pursuant to section 

14 4(b) as a result of any award of damages imposed 

15 by a court of law relating to any causes of action or 

16 allegations described in subsection (b); or 

17 (2) permit the use of any such funds— 

18 (A) as evidence in such an action or allega19 tion; or 

20 (B) to offset any award of damages in 

21 such an action or allegation. 

22 SEC. 6. NON-PREEMPTION OF AUTHORITIES. 

23 Nothing in this Act or the amendments made by this 

24 Act shall be construed to preempt or supersede any State 


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1 or local law, regulation, policy, or program, including laws, 

2 regulations, polices, and programs that— 

3 (1) limit, set, or enforce standards for green4 house gas emissions; 

5 (2) monitor, report, and keep records of green6 house gas emissions; 

7 (3) provide cost recovery for climate adaptation, 

8 mitigation, or resilience; or 

9 (4) conduct or support investigations. 

Æ 


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