I 

109TH CONGRESS 

1ST SESSION H. R. 2070 

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

tax on oil and natural gas (and products thereof) and to allow an 

income tax credit for purchases of fuel-efficient passenger vehicles, and 

to allow grants for mass transit. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 4, 2005 

Mr. KUCINICH (for himself, Mr. SERRANO, Mr. ABERCROMBIE, Mr. DEFAZIO, 

Mr. FRANK of Massachusetts, Mr. MCDERMOTT, Ms. SOLIS, Mr. FILNER, 

Ms. CARSON, Mr. GRIJALVA, Mr. LANTOS, Ms. LEE, Mr. MCGOVERN, 

Ms. MCKINNEY, Ms. WOOLSEY, Mr. OWENS, Mr. STRICKLAND, Mr. CONYERS, Mr. DAVIS of Illinois, Mr. SANDERS, Mr. FARR, Mr. HINCHEY, Mr. 

EVANS, Mr. NADLER, Mr. KANJORSKI, Mr. SHERMAN, Mr. LEWIS of 

Georgia, Mr. GUTIERREZ, Mr. VISCLOSKY, Mr. KILDEE, Ms. SLAUGHTER, Ms. KAPTUR, Mr. OLVER, and Mr. STUPAK) introduced the following bill; which was referred to the Committee on Ways and Means, 

and in addition to the Committee on Transportation and Infrastructure, 

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 windfall profit tax on oil and natural gas (and products 

thereof) and to allow an income tax credit for purchases 

of fuel-efficient passenger vehicles, and to allow grants 

for mass transit. 

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 ‘‘Gas Price Spike Act 

3 of 2005’’. 

4 SEC. 2. WINDFALL PROFITS TAX. 

5 (a) IN GENERAL.—Subtitle E of the Internal Rev6 enue Code of 1986 (relating to alcohol, tobacco, and cer7 tain other excise taxes) is amended by adding at the end 

8 thereof the following new chapter: 

9 ‘‘CHAPTER 56—WINDFALL PROFIT ON 

10 CRUDE OIL, NATURAL GAS, AND PROD11 UCTS THEREOF 

‘‘Sec. 5896. Imposition of tax. 

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 an excise 

15 tax on the sale in the United States of any crude oil, nat16 ural gas, or other taxable product a tax equal to the appli17 cable percentage of the windfall profit on such sale. 

18 ‘‘(b) DEFINITIONS.—For purposes of this section— 

19 ‘‘(1) TAXABLE PRODUCT.—The term ‘taxable 

20 product’ means any fuel which is a product of crude 

21 oil or natural gas. 

22 ‘‘(2) WINDFALL PROFIT.—The term ‘windfall 

23 profit’ means, with respect to any sale, so much of 
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1 the profit on such sale as exceeds a reasonable prof2 it. 

3 ‘‘(3) APPLICABLE PERCENTAGE.—The term 

4 ‘applicable percentage’ means— 

5 ‘‘(A) 50 percent to the extent that the 

6 profit on the sale exceeds 100 percent of the 

7 reasonable profit on the sale but does not ex8 ceed 102 percent of the reasonable profit on the 

9 sale, 

10 ‘‘(B) 75 percent to the extent that the 

11 profit on the sale exceeds 102 percent of the 

12 reasonable profit on the sale but does not ex13 ceed 105 percent of the reasonable profit on the 

14 sale, and 

15 ‘‘(C) 100 percent to the extent that the 

16 profit on the sale exceeds 105 percent of the 

17 reasonable profit on the sale. 

18 ‘‘(4) REASONABLE PROFIT.—The term ‘reason19 able profit’ means the amount determined by the 

20 Reasonable Profits Board to be a reasonable profit 

21 on the sale. 

22 ‘‘(c) LIABILITY FOR PAYMENT OF TAX.—The taxes 

23 imposed by subsection (a) shall be paid by the seller.’’. 
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1 (b) CLERICAL AMENDMENT.—The table of chapters 

2 for subtitle E of such Code is amended by adding at the 

3 end the following new item: 

‘‘CHAPTER 56. WINDFALL PROFIT ON CRUDE OIL AND REFINED PETROLEUM

PRODUCTS’’. 

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

5 this section shall take effect on the date of the enactment 

6 of this Act. 

7 SEC. 3. CREDIT FOR PURCHASING FUEL EFFICIENT AMER8 ICAN-MADE PASSENGER VEHICLES. 

9 (a) IN GENERAL.—Subpart A of part IV of sub10 chapter A of chapter 1 of the Internal Revenue Code of 

11 1986 (relating to nonrefundable personal credits) is 

12 amended by inserting after section 25B the following new 

13 section: 

14 ‘‘SEC. 25C. PURCHASE OF FUEL-EFFICIENT AMERICAN15 MADE PASSENGER VEHICLES. 

16 ‘‘(a) IN GENERAL.—In the case of an individual, 

17 there shall be allowed as a credit against the tax imposed 

18 by this chapter for the taxable year an amount equal to 

19 the cost of any qualified passenger vehicle purchased by 

20 the taxpayer during the taxable year. 

21 ‘‘(b) MAXIMUM CREDIT.—The credit allowed by this 

22 section for the taxable year shall not exceed— 

23 ‘‘(1) $3,000 in the case of a qualified passenger 

24 vehicle not described in paragraph (2) or (3), 
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1 ‘‘(2) $4,500 in the case of a qualified passenger 

2 vehicle the fuel economy of which is— 

3 ‘‘(A) in the case a truck or sport utility ve4 hicle, at least 45 miles per gallon but less than 

5 55 miles per gallon, and 

6 ‘‘(B) in any other case, at least 55 miles 

7 per gallon but less than 65 miles per gallon, 

8 and 

9 ‘‘(3) $6,000 in the case of a qualified passenger 

10 vehicle the fuel economy of which is— 

11 ‘‘(A) in the case a truck or sport utility ve12 hicle, at least 55 miles per gallon, and 

13 ‘‘(B) in any other case, at least 65 miles 

14 per gallon. 

15 ‘‘(c) QUALIFIED PASSENGER VEHICLE.—For pur16 poses of this section— 

17 ‘‘(1) IN GENERAL.—The term ‘qualified auto18 mobile’ means any automobile (as defined in section 

19 4064(b))— 

20 ‘‘(A) which is purchased after the date of 

21 the enactment of this section, 

22 ‘‘(B) which is assembled in the United 

23 States by individuals employed under a collec24 tive bargaining agreement, 
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1 ‘‘(C) the original use of which begins with 

2 the taxpayer, 

3 ‘‘(D) substantially all of the use of which 

4 is for personal, nonbusiness purposes, and 

5 ‘‘(E) the fuel economy of such automobile 

6 is— 

7 ‘‘(i) at least 35 miles per gallon in the 

8 case a truck or sport utility vehicle, and 

9 ‘‘(ii) at least 45 miles per gallon in 

10 any other case. 

11 ‘‘(2) FUEL ECONOMY.—Fuel economy shall be 

12 determined in accordance with section 4064. 

13 ‘‘(d) SPECIAL RULES.— 

14 ‘‘(1) BASIS REDUCTION.—The basis of any 

15 property for which a credit is allowable under sub16 section (a) shall be reduced by the amount of such 

17 credit. 

18 ‘‘(2) PROPERTY USED OUTSIDE UNITED STATES

19 NOT QUALIFIED.—No credit shall be allowed under 

20 subsection (a) with respect to any property referred 

21 to in section 50(b).’’. 

22 (b) CLERICAL AMENDMENT.—The table of sections 

23 for such subpart A is amended by inserting after the item 

24 relating to section 25B the following new item: 

‘‘Sec. 25C. Purchase of fuel-efficient American-made passenger vehicles.’’. 
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1 (c) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to taxable years ending after the 

3 date of the enactment of this Act. 

4 SEC. 4. MASS TRANSIT FARE REDUCTIONS DURING GAS 

5 PRICE SPIKES. 

6 (a) IN GENERAL.—The Secretary of Transportation 

7 may make grants to the operator of a mass transit system 

8 to assist the operator in reducing fares paid by passengers 

9 using the system. 

10 (b) USE OF GRANTS.—Grants received under the 

11 program shall be used solely for implementing a fare re12 duction described in subsection (a) that is applied equally 

13 to all passengers using the mass transit system. 

14 (c) MASS TRANSIT SYSTEM DEFINED.—In this sec15 tion, the term ‘‘mass transit system’’ includes bus and 

16 commuter rail systems. 

17 (d) AUTHORIZATION OF APPROPRIATIONS.—There is 

18 authorized to be appropriated to carry out this section in 

19 a fiscal year amounts equivalent to the excess (if any) of— 

20 (1) the revenues received during the preceding 

21 fiscal year pursuant to chapter 56 of the Internal 

22 Revenue Code of 1986 (relating to windfall profit on 

23 crude oil and refined petroleum products), over 
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1 (2) the revenue cost for such fiscal year of sec2 tion 25C of such Code (relating to purchase of fuel3 efficient American-made passenger vehicles). 

4 Amounts authorized under the preceding sentence shall re5 main available until expended. 

6 SEC. 5. REASONABLE PROFITS BOARD. 

7 (a) ESTABLISHMENT.—There is established an inde8 pendent board to be known as the ‘‘Reasonable Profits 

9 Board’’ (hereafter in this section referred to as the 

10 ‘‘Board’’). 

11 (b) DUTIES.—The Board shall make reasonable prof12 it determinations for purposes of applying section 5896 

13 of the Internal Revenue Code of 1986 (relating to windfall 

14 profit on crude oil, natural gas, and products thereof). 

15 (c) ADVISORY COMMITTEE.—The Board shall be con16 sidered an advisory committee within the meaning of the 

17 Federal Advisory Committee Act (5 U.S.C. App.). 

18 (d) APPOINTMENT.— 

19 (1) MEMBERS.—The Board shall be composed 

20 of 3 members appointed by the President of the 

21 United States. 

22 (2) TERM.—Members of the Board shall be ap23 pointed for a term of 3 years. 
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1 (3) BACKGROUND.—The members shall have no 

2 financial interests in any of the businesses for which 

3 reasonable profits are determined by the Board. 

4 (e) PAY AND TRAVEL EXPENSES.— 

5 (1) PAY.—Notwithstanding section 7 of the 

6 Federal Advisory Committee Act (5 U.S.C. App.), 

7 members of the Board shall be paid at a rate equal 

8 to the daily equivalent of the minimum annual rate 

9 of basic pay for level IV of the Executive Schedule 

10 under section 5315 of title 5, United States Code, 

11 for each day (including travel time) during which the 

12 member is engaged in the actual performance of du13 ties vested in the Board. 

14 (2) TRAVEL EXPENSES.—Members shall receive 

15 travel expenses, including per diem in lieu of subsist16 ence, in accordance with section 5702 and 5703 of 

17 title 5, United States Code. 

18 (f) DIRECTOR OF STAFF.— 

19 (1) QUALIFICATIONS.—The Board shall appoint 

20 a Director who has no financial interests in any of 

21 the businesses for which reasonable profits are de22 termined by the Board. 

23 (2) PAY.—Notwithstanding section 7 of the 

24 Federal Advisory Committee Act (5 U.S.C. App.), 

25 the Director shall be paid at the rate of basic pay 
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1 payable for level IV of the Executive Schedule under 

2 section 5315 of title 5, United States Code. 

3 (g) STAFF.— 

4 (1) ADDITIONAL PERSONNEL.—The Director, 

5 with the approval of the Board, may appoint and fix 

6 the pay of additional personnel. 

7 (2) APPOINTMENTS.—The Director may make 

8 such appointments without regard to the provisions 

9 of title 5, United States Code, governing appoint10 ments in the competitive service, and any personnel 

11 so appointed may be paid without regard to the pro12 visions of chapter 51 and subchapter III of chapter 

13 53 of that title relating to classification and General 

14 Schedule pay rates. 

15 (3) DETAILEES.—Upon the request of the Di16 rector, the head of any Federal department or agen17 cy may detail any of the personnel of that depart18 ment or agency to the Board to assist the Board in 

19 accordance with an agreement entered into with the 

20 Board. 

21 (4) ASSISTANCE.—The Comptroller General of 

22 the United States may provide assistance, including 

23 the detailing of employees, to the Board in accord24 ance with an agreement entered into with the Board. 

25 (h) OTHER AUTHORITY.— 
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1 (1) EXPERTS AND CONSULTANTS.—The Board 

2 may procure by contract, to the extent funds are 

3 available, the temporary or intermittent services of 

4 experts or consultants pursuant to section 3109 of 

5 title 5, United States Code. 

6 (2) LEASING.—The Board may lease space and 

7 acquire personal property to the extent that funds 

8 are available. 

9 (i) FUNDING.—There are authorized to be appro10 priated such funds as are necessary to carry out this sec11 tion. 

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