‘‘(A) any domestic natural gas is used in
or exported from the United States, and
‘‘(B) before such use or exportation, no tax
was imposed on such natural gas under sub-
section (a),
then a tax at the rate specified in subsection (c) is
hereby imposed on such natural gas.
‘‘(2) EXCEPTION FOR CERTAIN USES ON PREM-
ISES WHERE PRODUCED.—Paragraph (1) shall not
apply to any use of natural gas for extracting oil or
natural gas on the premises where such natural gas
was produced. The preceding sentence shall not
apply to any use involving the combustion of the
natural gas.
‘‘(c) RATE OF TAX.—
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), the rate of the taxes imposed by this sec-
tion shall be 48 cents per MCF.
‘‘(2) PHASE-IN.—
The rate of the taxes
imposed by subsection (a)
Effective during
shall be the fol-
calendar year
lowing amount per MCF
1994 ..........................................................................
$.096
1995 ..........................................................................
$.192
1996 ..........................................................................
$.288
1997 ..........................................................................
$.384
‘‘(d) PERSONS LIABLE FOR TAX.—
‘‘(1) RECEIPT AT PIPELINE.—The tax imposed
by subsection (a)(1) shall be paid by the operator of
the United States pipeline facility.
‘‘(2) IMPORTATION.—The tax imposed by sub-
section (a)(2) shall be paid by the person entering
the 
natural 
gas 
for 
consumption, 
use, 
or
warehousing.
‘‘(3) TAX ON USE OR EXPORTS.—The tax im-
posed by subsection (b) shall be paid by the person
using or exporting the natural gas, as the case may
be.
‘‘(e) DEFINITIONS.—For purposes of this section—
‘‘(1) NATURAL GAS.—The term ‘natural gas’
includes any natural gas liquid which is not treated
as petroleum for purposes of the tax imposed by sec-
tion 4692.
‘‘(2) DOMESTIC NATURAL GAS.—The term ‘do-
mestic natural gas’ means any natural gas produced
from a well located in the United States.
‘‘(3) UNITED STATES PIPELINE FACILITY.—The
term ‘United States pipeline facility’ means any
pipeline in the United States used for purposes of
transporting natural gas (other than a pipeline
which is part of a gathering system).
‘‘(4) MCF.—The term ‘MCF’ means 1,000
cubic feet.
‘‘(5) OTHER DEFINITIONS.—The terms ‘United
States’ and ‘premises’ have the respective meanings
given such terms by section 4612(a).
‘‘(6) FRACTIONAL PART OF MCF.—In the case
of a fraction of an MCF, the tax imposed by this
section shall be the same fraction of the amount of
such tax imposed on a whole MCF.
‘‘(7) CERTAIN
RULES
MADE
APPLICABLE.—
Rules similar to the rules of subsections (b), (c), and
(e) of section 4612 shall apply to the tax imposed
by this section.
‘‘SEC. 4694. INFLATION ADJUSTMENTS.
‘‘(a) GENERAL RULE.—Each rate of tax which would
otherwise be in effect under this subchapter during any
calendar year after 1994 shall be increased by the percent-
age (if any) by which—
‘‘(1) the CPI for the preceding calendar year
(as defined in section 1(f)(4)), exceeds
‘‘(2) the CPI for calendar year 1993 (as so de-
fined).
‘‘(b) ROUNDING.—Any increase under subsection (a)
shall be rounded—
‘‘(1) to the nearest multiple of 10 cents in the
case of a rate in effect under section 4691,
‘‘(2) to the nearest multiple of 1 cent in the
case of a rate in effect under section 4692, and
‘‘(3) to the nearest multiple of 1/10 cent in the
case of a rate in effect under section 4693.’’
(b) CLERICAL AMENDMENT.—The table of sub-
chapters for chapter 38 of such Code is amended by add-
ing at the end thereof the following new item:
‘‘SUBCHAPTER E. Carbon tax on primary fossil fuels.’’
(c) EFFECTIVE DATE.—The amendments made by
this section shall take effect on January 1, 1994.
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