Battery Fire Prevention Act
- Bill Number
- H.R. 5686
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- Taxation
- Status
- Introduced
- Latest Action
- 2025-10-03: Referred to the Committee on Ways and Means, and in addition to the Committees on Energy and Commerce, and Oversight and Government Reform, 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.
- Last Updated
- 2025-11-21T16:31:34Z
AI-Generated Summary
Purpose of the Legislation
The Battery Fire Prevention Act (H.R. 5686) aims to reduce fire risks from batteries, particularly lithium batteries, by promoting their safe detection, recycling, and recovery. It does this through tax incentives for recycling equipment, a new tax on battery sales to fund recycling efforts, and the creation of a national program to encourage battery buy-backs and proper disposal.
Key Provisions
- Tax Credit for Battery Detectors (Section 2): Provides a 30% tax credit for businesses in the recycling trade that purchase devices using technologies like X-ray, artificial intelligence (AI), or radio-frequency identification (RFID) to detect batteries. The credit applies to the original use of these devices and prevents double-dipping with other tax benefits (e.g., no additional deductions for the same expense). Effective for taxable years beginning after December 31, 2025.
- Battery Sales Tax (Section 3): Imposes a 5% excise tax on the sale price of batteries by manufacturers, producers, or importers. This tax is collected similarly to other manufacturer excise taxes in the Internal Revenue Code (IRC). Effective for sales after December 31, 2025.
- Lithium Battery Buy-Back Trust Fund (Section 4): Establishes a dedicated fund in the U.S. Treasury, funded by revenues from the new battery sales tax. The fund supports the National Battery Recycling Program without needing further congressional appropriations. Effective for taxes received after December 31, 2025.
- National Battery Recycling Program (Section 5): Requires the Secretary of Energy and the EPA Administrator to jointly create a program within 5 years of enactment. Key elements include:
- Identifying and listing approved lithium battery recycling facilities (including those funded under existing laws like the Infrastructure Investment and Jobs Act).
- Awarding competitive grants to these facilities for setting up collection systems that offer financial incentives (e.g., payments) to individuals who return used lithium batteries.
- Mandating federal agencies to prioritize buying lithium batteries from approved recycling facilities.
- Defines "lithium battery" as lithium metal or lithium-ion types. Funding is limited to the Buy-Back Trust Fund.
Significant Changes to Existing Law
- Amends the IRC by adding a new business tax credit (Section 45BB) under general business credits, expanding incentives for environmental and safety equipment in recycling.
- Introduces a new subchapter (E) in IRC Chapter 32 for a manufacturer excise tax on batteries (Section 4191), similar to taxes on items like gasoline or tires but targeted specifically at batteries.
- Creates a new trust fund (Section 9512) in IRC Chapter 98, channeling battery tax revenues directly to energy and environmental programs, bypassing general Treasury funds.
- Builds on existing laws by integrating with the Infrastructure Investment and Jobs Act's battery recycling grants, but adds mandatory federal procurement preferences and a national collection incentive system.
These changes take effect mostly after December 31, 2025, with the recycling program rule-making required within 5 years.
Potential Impacts
- On Government Agencies: The Department of Energy (DOE) and Environmental Protection Agency (EPA) gain new responsibilities for program development, facility approvals, and grant awards, potentially increasing administrative workload but providing dedicated funding. Other federal agencies must adjust procurement to favor recycled batteries, promoting sustainability in government operations.
- On Citizens: Individuals benefit from financial incentives to return used batteries, making recycling easier and safer. This could reduce household fire risks from improper battery disposal and encourage eco-friendly habits without direct costs to consumers.
- On Businesses: Recycling companies receive tax credits to adopt advanced detection tech, lowering costs for fire prevention. Battery manufacturers and importers face a 5% price hike, which may be passed to consumers, but could spur innovation in safer battery design.
- On International Relations: Minimal direct impact, though it may influence global battery supply chains by favoring U.S.-based recycling, potentially affecting trade with battery-exporting countries like China.
- Broader Environmental and Safety Effects: Enhances battery recycling infrastructure, reducing landfill waste, fire hazards in recycling facilities, and environmental pollution from lithium batteries, supporting national goals for clean energy transitions.
Main Stakeholders Affected
- Recycling Businesses: Primary beneficiaries of tax credits and grants for detection equipment and collection systems.
- Battery Manufacturers, Producers, and Importers: Bear the new 5% sales tax, increasing operational costs.
- Consumers and Households: Gain incentives for returning batteries, improving access to safe disposal.
- Federal Government Entities: DOE, EPA, and purchasing agencies (e.g., Department of Defense) involved in program implementation and procurement shifts.
- Taxpayers and the IRS: Administer new credits, taxes, and trust fund transfers, with indirect benefits from funded environmental programs.
Notable Legal, Constitutional, or Political Implications
- Legal Implications: Relies on Congress's authority under the IRC to create targeted tax credits and excise taxes for public policy goals like safety and environmental protection. The trust fund ensures dedicated funding, reducing reliance on annual budgets, but requires IRS enforcement for compliance. Potential challenges could arise over tax definitions (e.g., what qualifies as a "battery") or grant award fairness.
- Constitutional Implications: Aligns with Congress's taxing and spending powers (Article I, Section 8), as it uses revenue-raising for a specific public welfare purpose (fire prevention and recycling). No apparent First Amendment or due process issues, though the 5-year delay for the recycling program might invite scrutiny on implementation timelines.
- Political Implications: Advances bipartisan interests in environmental sustainability and public safety amid rising electric vehicle and device battery use. It could face debate over tax burdens on industry versus benefits for green jobs, but the dedicated fund structure minimizes ongoing fiscal fights by linking revenues directly to program needs.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Rep. Norcross, Donald [D-NJ-1]
Recent Actions
- 2025-10-03: Referred to the Committee on Ways and Means, and in addition to the Committees on Energy and Commerce, and Oversight and Government Reform, 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.
- 2025-10-03: Referred to the Committee on Ways and Means, and in addition to the Committees on Energy and Commerce, and Oversight and Government Reform, 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.
- 2025-10-03: Referred to the Committee on Ways and Means, and in addition to the Committees on Energy and Commerce, and Oversight and Government Reform, 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.
- 2025-10-03: Introduced in House
- 2025-10-03: Introduced in House
Bill Versions
- Battery Fire Prevention Act — issued 2025-10-03 — PDF (7 pages)