Port Crane Tax Credit Act of 2025

Bill Number

H.R. 4589

Origin Chamber

House

Congress

119th Congress, Session 1

Policy Area

Taxation

Status

Introduced

Latest Action

2025-07-22: Referred to the House Committee on Ways and Means.

Last Updated

2025-08-06T18:16:33Z

AI-Generated Summary

Purpose of the Legislation

The Port Crane Tax Credit Act of 2025 aims to encourage the domestic production and manufacturing of port cranes—large machines used at U.S. ports to load and unload cargo from ships—by providing tax incentives. This is intended to boost U.S. manufacturing capabilities, reduce dependence on foreign suppliers, and support port infrastructure.

Key Provisions

• Port Crane Manufacturing Facility Investment Credit (Section 2):
• Offers a 25% tax credit on the cost (basis) of qualified investments in facilities that build, repair, or produce components for port cranes.
• Qualified facilities must be located in the U.S. (including territories) and primarily focused on port crane-related activities.
• Eligible property includes tangible assets like machinery, equipment, and buildings (excluding unrelated office spaces) that are depreciable and integral to operations.
• Port cranes are defined as gantry cranes, mobile harbor cranes, or ship-to-shore gantry cranes used for handling cargo containers or bulk goods.
• Taxpayers can elect to receive the credit as a direct payment from the government (elective payment) or transfer it to another party for cash.
• The credit applies to property placed in service after the bill's enactment and ends for property placed in service after December 31, 2035.

• Port Crane Production Credit (Section 3):
• Provides a tax credit equal to 40% of the sale price for port cranes produced and sold in the U.S. to unrelated buyers; increases to 60% if at least 90% of the crane's components (e.g., steel frames, cabling, brakes) are made in the U.S.
• Includes a phase-out: reduced to 75% of full credit in 2035, 85% in 2036, and eliminated after 2036.
• Like the investment credit, it qualifies for elective payment or transfer to another entity.
• Applies to cranes produced in taxable years beginning after enactment.

• General Rules:
• Both credits are part of the general business credit under the Internal Revenue Code (IRC), allowing them to offset other taxes.
• Progress payments for ongoing construction qualify under rules similar to existing IRC provisions.
• Definitions for "port crane" and "component materials" are consistent across sections.

Significant Changes to Existing Law

• Adds new IRC sections: 48F for the investment credit (inserted after section 48E) and 45BB for the production credit (inserted after section 45AA).
• Expands elective payment eligibility under section 6417 to include these credits, allowing non-taxable entities (e.g., nonprofits) to receive refunds.
• Makes these credits transferable under section 6418, enabling businesses to sell credits for liquidity.
• Updates conforming sections (e.g., 46, 49, 50) to integrate the new credits without altering core IRC structures, such as depreciation rules or recapture provisions for early dispositions.

Potential Impacts

• On Government Agencies: The IRS and Treasury Department will need to administer, verify, and determine eligibility for these credits, potentially increasing administrative workload. The credits may reduce federal tax revenue in the short term but could stimulate economic growth and job creation, indirectly benefiting government through higher overall tax collections.
• On Citizens: U.S. workers and communities near manufacturing sites may see job opportunities in crane production and related industries. Consumers and businesses relying on efficient ports could benefit from more reliable domestic supply chains, potentially lowering long-term costs for imported goods.
• On International Relations: By incentivizing U.S.-made port cranes and components, the law could reduce reliance on foreign imports (e.g., from China, which dominates global production), possibly straining trade ties but enhancing U.S. supply chain security for critical infrastructure.

Main Stakeholders Affected

• Port Crane Manufacturers and Suppliers: Primary beneficiaries, gaining financial incentives to build or expand U.S. facilities and produce cranes with domestic components.
• Taxpayers and Businesses: Eligible companies can claim credits to lower taxes, receive direct payments, or transfer credits; unrelated buyers of cranes may indirectly benefit from competitive pricing.
• U.S. Ports and Shipping Industry: Improved domestic availability of cranes could enhance port efficiency and resilience against global disruptions.
• Workers and Labor Unions: Potential for increased employment in manufacturing, repair, and component production sectors.
• Government Entities: Federal agencies like the IRS for enforcement; ports and territories as indirect users of incentivized infrastructure.

Notable Legal, Constitutional, or Political Implications

• Legal: The credits align with existing IRC frameworks for business incentives (e.g., clean energy credits), minimizing litigation risks. However, definitions like "critical components" determined by the Secretary of the Treasury introduce administrative discretion, which could lead to disputes over eligibility. No basis adjustment for the investment credit may affect depreciation calculations.
• Constitutional: No apparent conflicts; the law uses Congress's taxing and spending powers to promote domestic industry, consistent with precedents like the Commerce Clause.
• Political: Promotes "Buy American" policies for national security in port infrastructure, potentially bipartisan appeal in supporting U.S. manufacturing amid global trade tensions. The phase-out and termination dates encourage temporary boosts without permanent entitlements, but critics might view it as targeted corporate welfare.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Ezell, Mike [R-MS-4]

Cosponsors (4)

Rep. Weber, Randy K. Sr. [R-TX-14], Rep. Malliotakis, Nicole [R-NY-11], Rep. Kiggans, Jennifer A. [R-VA-2], Rep. Rouzer, David [R-NC-7]

Recent Actions

• 2025-07-22: Referred to the House Committee on Ways and Means.
• 2025-07-22: Introduced in House
• 2025-07-22: Introduced in House

Bill Versions

• Port Crane Tax Credit Act of 2025 — issued 2025-07-22 — PDF (10 pages)