I 
109TH CONGRESS 
1ST SESSION H. R. 4276 
To amend the Internal Revenue Code of 1986 to impose a windfall profit 
tax on oil and natural gas (and products thereof) and to use the proceeds 
of the windfall profit tax collected to carry out the Low-Income Home 
Energy Assistance Act and for medical services provided by the Depart-
ment of Veterans Affairs. 
IN THE HOUSE OF REPRESENTATIVES 
NOVEMBER 9, 2005 
Mr. LARSON of Connecticut (for himself and Ms. DELAURO) introduced the 
following bill; which was referred to the Committee on Ways and Means, 
and in addition to the Committees on Energy and Commerce, Education 
and the Workforce, and Veterans’ Affairs, for a period to be subsequently 
determined by the Speaker, in each case for consideration of such provi-
sions 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 use the proceeds of the windfall profit 
tax collected to carry out the Low-Income Home Energy 
Assistance Act and for medical services provided by the 
Department of Veterans Affairs. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Consumer Windfall 
Excess Oil Profits Protection Act of 2005’’. 
SEC. 2. WINDFALL PROFITS TAX ON CRUDE OIL, NATURAL 
GAS, AND PRODUCTS THEREOF. 
(a) IN GENERAL.—Subtitle E of the Internal Rev-
enue Code of 1986 (relating to alcohol, tobacco, and cer-
tain other excise taxes) is amended by adding at the end 
thereof the following new chapter: 
‘‘CHAPTER 
56—WINDFALL 
PROFITS 
ON 
CRUDE OIL, NATURAL GAS, AND PROD-
UCTS THEREOF 
‘‘Sec. 5896. Imposition of tax. 
‘‘Sec. 5897. Windfall profit; etc. 
‘‘Sec. 5898. Special rules and definitions. 
‘‘SEC. 5896. IMPOSITION OF TAX. 
‘‘In addition to any other tax imposed under this title, 
there is hereby imposed on every taxpayer an excise tax 
in an amount equal to 50 percent of the windfall profit 
for any taxable year from— 
‘‘(1) sales of any crude oil, natural gas, or other 
taxable product thereof, and 
‘‘(2) net gains from transactions of an interest 
the price of which is determined in whole or in part 
by reference to the price of crude oil, natural gas, 
or other taxable product thereof.
‘‘SEC. 5897. WINDFALL PROFIT; ETC. 
‘‘(a) GENERAL RULE.—For purposes of this chapter, 
the term ‘windfall profit’ means the excess of— 
‘‘(1) the adjusted taxable income of the tax-
payer for the taxable year, over 
‘‘(2) the reasonably inflated average profit for 
such taxable year. 
‘‘(b) ADJUSTED TAXABLE INCOME.—For purposes of 
this chapter, with respect to any taxpayer, the adjusted 
taxable income for any taxable year is equal to the taxable 
income for such taxable year (within the meaning of sec-
tion 63 and determined without regard to this sub-
section)— 
‘‘(1) increased by any interest expense deduc-
tion, charitable contribution deduction, and any net 
operating loss deduction carried forward from any 
prior taxable year, and 
‘‘(2) reduced by any interest income, dividend 
income, and net operating losses to the extent such 
losses exceed taxable income for the taxable year. 
In the case of any taxpayer which is a foreign corporation, 
the adjusted taxable income shall be determined with re-
spect to such income which is effectively connected with 
the conduct of a trade or business in the United States. 
‘‘(c) REASONABLY INFLATED AVERAGE PROFIT.— 
For purposes of this chapter, with respect to any applica-
ble taxpayer, the reasonably inflated average profit for any 
taxable year is an amount equal to the average of the ad-
justed taxable income of such taxpayer for taxable years 
beginning during the 2000–2004 taxable year period (de-
termined without regard to the taxable year with the high-
est adjusted taxable income in such period) plus 10 per-
cent of such average. 
‘‘(d) TAXABLE PRODUCT THEREOF.—The term ‘tax-
able product thereof’ means any fuel which is a product 
of crude oil or natural gas. 
‘‘SEC. 5898. SPECIAL RULES AND DEFINITIONS. 
‘‘(a) WITHHOLDING AND DEPOSIT OF TAX.—The 
Secretary shall provide such rules as are necessary for the 
withholding and deposit of the tax imposed under section 
5896. 
‘‘(b) RECORDS AND INFORMATION.—Each taxpayer 
liable for tax under section 5896 shall keep such records, 
make such returns, and furnish such information as the 
Secretary may by regulations prescribe. 
‘‘(c) RETURN OF WINDFALL PROFIT TAX.—The Sec-
retary shall provide for the filing and the time of such 
filing of the return of the tax imposed under section 5896. 
‘‘(d) BUSINESSES UNDER COMMON CONTROL.—For 
purposes of this chapter, all members of the same con-
trolled group of corporations (within the meaning of sec-
tion 267(f)) and all persons under common control (within 
the meaning of section 52(b) but determined by treating 
an interest of more than 50 percent as a controlling inter-
est) shall be treated as 1 person. 
‘‘(e) REGULATIONS.—The Secretary shall prescribe 
such regulations as may be necessary or appropriate to 
carry out the purposes of this chapter.’’. 
(b) CLERICAL AMENDMENT.—The table of chapters 
for subtitle E of such Code is amended by adding at the 
end the following new item: 
‘‘CHAPTER 56. WINDFALL PROFITS ON CRUDE OIL, NATURAL GAS, AND 
PRODUCTS THEREOF’’. 
(c) DEDUCTIBILITY OF WINDFALL PROFIT TAX.— 
The first sentence of section 164(a) of such Code (relating 
to deduction for taxes) is amended by inserting after para-
graph (5) the following new paragraph: 
‘‘(6) The windfall profit tax imposed by section 
5896.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning in 2005 
or 2006.
SEC. 3. USE OF PROCEEDS FROM WINDFALL PROFITS ON 
CRUDE OIL, NATURAL GAS, AND PRODUCTS 
THEREOF. 
There are hereby appropriated amounts equivalent to 
the taxes received in the Treasury under chapter 56 of 
the Internal Revenue Code of 1986, as follows: 
(1) 50 percent of such amounts, which shall be 
available only for carrying out the Low-Income 
Home Energy Assistance Act of 1981, and 
(2) 50 percent of such amounts, which shall be 
credited to the current appropriation of the Depart-
ment of Veterans Affairs that is available for med-
ical services. 
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