Consumers REBATE Act

To amend the Internal Revenue Code of 1986 to impose a tax on fossil fuels and to use the revenues for economic benefit. 1. Short title This Act may be cited as the Consumers Rebate to ban Emissions and Boost AlTernative Energy Act Consumers REBATE Act 2. Excise tax on carbon dioxide content of coal, oil, and natural gas (a) In general The Internal Revenue Code of 1986 is amended by adding at the end the following: L Carbon dioxide content of coal, oil, and natural gas Sec. 9901. Imposition of tax. Sec. 9902. Carbon equivalency fee. Sec. 9903. Definitions. Sec. 9904. Special rules. 9901. Imposition of tax (a) In general There is hereby imposed a tax on producing at the wellhead or mine in the United States, or importing, a taxable carbon substance. (b) Rate of tax (1) In general The tax imposed under subsection (a) shall be the applicable amount per metric ton of carbon dioxide content of the life-cycle emissions from the taxable carbon substance. (2) Applicable amount For purposes of paragraph (1)— (A) In general For calendar year 2021, the term applicable amount (B) Annual adjustments generally In the case of any taxable year beginning in a calendar year after 2021, the dollar amount in effect under subparagraph (A) for the preceding calendar shall be increased by $10. (3) Zero rate if emission reduction benchmark attained (A) In general If the Administrator determines and specifies in a report issued under subsection (c)(3)(A) in the year immediately preceding a year specified in subsection (c)(1)(A) that the emissions reduction benchmark for that specified year will be met or exceeded, then for that specified year and the succeeding 4 calendar years— (i) paragraph (2) shall not apply, and (ii) the applicable amount shall be zero. (B) Reinstatement (i) In general Except as provided in clause (ii), for any calendar year after a period referred to in subparagraph (A), paragraph (2) shall be applied and the applicable amount for the first such calendar year shall be the dollar amount in effect for the calendar year preceding the beginning of such period. (ii) Exception Clause (i) shall not apply to a calendar year if, with respect to that calendar year, a determination described in subparagraph (A) applies to that calendar year. (c) Emissions reductions benchmarks For purposes of this section— (1) In general The emissions reduction benchmarks are as follows: (A) 30 percent below the emissions benchmark by 2025. (B) 40 percent below the emissions benchmark by 2030. (C) 50 percent below the emissions benchmark by 2035. (D) 70 percent below the emissions benchmark by 2045. (E) 80 percent below the emissions benchmark by 2050. (2) Emissions benchmark The emissions benchmark is the 2005 level of life-cycle emissions from the taxable carbon substances, as determined by the Administrator. (3) Reports (A) Emissions reductions target report Not later than 2 years after the date of enactment of the Consumers Rebate to ban Emissions and Boost AlTernative Energy Act (B) 5-year report The Administrator shall, after consultation with other appropriate Federal and State agencies and non-Federal stakeholders, issue a report every 5 years on the effects of the carbon tax established under this subtitle, including energy market conditions, impacts to consumers, impacts to the environment, actual emission reductions, and reliability and resiliency of the electric grid. (d) By whom paid The tax imposed by subsection (a) shall be paid by the producer, miner, or importer of the taxable carbon substance. (e) Regulations Not later than 2 years after the date of enactment of the Consumers Rebate to ban Emissions and Boost AlTernative Energy Act 9902. Carbon equivalency fee (a) Purpose The purpose of this section is to ensure the environmental effectiveness of this subtitle. (b) Imports The Secretary, in consultation with the Secretary of Energy, the Administrator, and the Commissioner of the U.S. Customs and Border Protection, shall impose carbon equivalency fees on imports of goods containing or produced using a taxable carbon substance. The amount of the carbon equivalency fee with respect to the import of any good shall be equal to the cost that domestic producers of a comparable good incur as a result of— (1) the tax imposed under section 9901, and (2) carbon equivalency fees imposed under this section on any goods used in the production of such good. (c) Collection The fees imposed under this section shall be collected by the Commissioner of the U.S. Customs and Border Protection. (d) Expiration This section shall cease to have effect at such time as and to the extent that— (1) an international agreement requiring countries that emit carbon dioxide or produce goods containing or using taxable carbon substances to adopt equivalent measures comes into effect, or (2) the country of export has implemented equivalent measures, as determined by the Secretary, in consultation with the Secretary of State. 9903. Definitions For purposes of this subtitle— (1) Taxable carbon substance The term taxable carbon substance (A) coal, (B) oil, and (C) natural gas. (2) Coal The term coal (3) Oil The term oil (4) Natural gas The term natural gas (5) Life-cycle emissions The term life-cycle emissions (6) Administrator The term Administrator (7) United States The term United States 9904. Special rules (a) Export For purposes of this subtitle— (1) In general No tax shall be imposed under section 9901 on the production or mining of a taxable carbon substance which is intended for export, including the sale or resale by a purchaser to a second purchaser for export. (2) Proof of export required Rules similar to the rules of section 4221(b) shall apply for purposes of paragraph (1). (3) Credit or refund where tax paid (A) In general Except as provided in subparagraph (B), if— (i) tax under section 9901 was paid with respect to any taxable carbon substance, and (ii) (I) such substance was exported by any person, or (II) such substance was used as a material in the manufacture or production of a substance which was exported by any person and which, at the time of export, was a taxable carbon substance (as defined in section 9902(1)), credit or refund (without interest) of such tax shall be allowed or made to the person who paid such tax. (B) Condition to allowance No credit or refund shall be allowed or made under subparagraph (A) unless the person who paid the tax establishes that he— (i) has repaid or agreed to repay the amount of the tax to the person who exported the taxable chemical or taxable substance (as so defined), or (ii) has obtained the written consent of such exporter to the allowance of the credit or the making of the refund. (4) Refunds directly to exporter The Secretary shall provide, in regulations, the circumstances under which a credit or refund (without interest) of the tax under section 9901 shall be allowed or made to the person who exported the taxable carbon substance, where— (A) the person who paid the tax waives his claim to the amount of such credit or refund, and (B) the person exporting the taxable carbon substance provides such information as the Secretary may require in such regulations. (5) Regulations The Secretary shall prescribe such regulations as may be necessary to carry out the purposes of this subsection. . (b) Establishment of trust fund (1) In general Subchapter A of chapter 98 of such Code (relating to trust fund code) is amended by adding at the end the following: 9512. Carbon trust fund (a) Creation of trust fund There is established in the Treasury of the United States a trust fund to be known as the Carbon Trust Fund Trust Fund (b) Transfers to trust fund There is hereby appropriated to the Trust Fund an amount equivalent to the amounts received in the Treasury pursuant to section 9901. (c) Expenditures from trust fund (1) In general From amounts in the Trust Fund at the beginning of a fiscal year, the following amounts shall be made available as follows: (A) The amount necessary shall be paid into general receipts in the Treasury to offset a reduction in the rate of individual income tax by reason of the amendments made by section 2(c) of the Consumers Rebate to ban Emissions and Boost AlTernative Energy Act (B) Of the amounts remaining available after the application of subparagraph (A), 20 percent shall be available for the following: (i) Worker transition assistance, with an emphasis on coal workers and coal communities, and workforce development. (ii) Rural energy assistance and efficiency improvements. (iii) Technology neutral, energy-related research and development. (iv) Air, rail, and marine transportation emissions reduction and efficiency programs. (v) Electric grid and pipeline innovations and improvements. (vi) Increasing resiliency of water, transportation, energy, and other infrastructure that are vulnerable to extreme weather and other effects of a changing climate. (vii) Energy efficiency and conservation. (C) The amounts remaining after the application of subparagraphs (A) and (B) shall be made available for quarterly citizen rebates. (2) Consultation In determining the amount provided toward each category referred to in paragraph (1)(B), the Secretary shall consult with the Secretary of Energy, the Secretary of Labor, and any other relevant Federal agency prior to distributing money from the Trust Fund. . (2) Clerical amendment The table of sections for subchapter A of chapter 98 of such Code is amended by adding at the end the following new item: Sec. 9512. Carbon trust fund. . (c) Reduction in individual income tax rates (1) In general Section 1(j) of such Code is amended by redesignating paragraph (6) as paragraph (7) and by inserting after paragraph (5) the following: (6) Reduction in individual income tax rates In the case of taxable years beginning after December 31, 2021, the tables under paragraph (2) shall be applied— (A) by substituting 9% 10% (B) by substituting 11% 12% (C) by substituting 21% 22% (D) by substituting 23.5% 24% . (2) Coordination among provisions relating to children with unearned income Clauses (i)(II) and (III) of section 1(j)(4)(B) of such Code are amended by striking paragraph (3) paragraphs (3) and (6) (d) Quarterly citizen rebates (1) Quarterly payments to eligible dividend recipients (A) In general From amounts made available pursuant to section 9512(c)(1)(C) (B) Amount of payment For purposes of subparagraph (A), the amount of each payment with respect to an eligible dividend recipient shall be the amount determined by the Secretary by dividing— (i) for the years 2022 through 2030— (I) the total amount available under section 9512(c)(1)(C) (II) the total number of eligible dividend recipients for such preceding calendar quarter, and (ii) for year 2031 and subsequent years— (I) the smaller of— (aa) the quarterly average of the total amount available under section 9512(c)(1)(C) (bb) the total amount available under section 9512(c)(1)(C) (II) the total number of eligible dividend recipients for such preceding calendar quarter. (C) Eligible dividend recipient For purposes of this subsection, the term eligible dividend recipient (D) Fund The term Fund section 9512 (2) Regulations The Secretary of the Treasury shall promulgate regulations governing the payment of funds under paragraph (1), including— (A) procedures for the identification and maintenance of an accurate list of eligible dividend recipients, and (B) the use of electronic means for transfers of funds, to the maximum extent practicable. (e) Clerical amendment The table of subtitles for the Internal Revenue Code of 1986 is amended by adding at the end the following new item: Subtitle L. Carbon dioxide content of coal, oil, and natural gas. . (f) Effective date (1) Except as provided by paragraph (2), the amendments made by this section shall take effect on January 1, 2022. (2) The amendments made by subsection (c) shall apply to taxable years beginning after December 31, 2021.

Summary: Consumers Rebate to ban Emissions and Boost AlTernative Energy Act or the Consumers REBATE Act This bill imposes an excise tax on the carbon dioxide content of coal, oil, and natural gas. The tax must be paid by the producer, miner, or importer of the taxable carbon substance and does not apply to exports of the substances. Beginning in 2021, the tax rate is $25 per ton of carbon dioxide content of the life-cycle emissions from the taxable carbon substance. After 2021, the tax increases by $10 each year and does not apply if specified emissions reduction benchmarks have been attained. The bill also includes provisions that require certain fees or refunds for taxable carbon substances that are exported or imported. Funds equivalent to the revenues received from the tax must be transferred to a Carbon Trust Fund established by this bill. The funds must be used, as provided by appropriations Acts, to offset reductions in individual income tax rates, pay quarterly dividends to certain individuals with valid Social Security numbers; and for specified worker transition assistance, energy, research, and infrastructure priorities.