Chemical Tax Repeal Act
- Bill Number
- H.R. 640
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- Taxation
- Status
- Introduced
- Latest Action
- 2025-01-22: Referred to the House Committee on Ways and Means.
- Last Updated
- 2026-06-09T12:50:49Z
AI-Generated Summary
Purpose
The "Chemical Tax Repeal Act" (H.R. 640) aims to eliminate specific federal excise taxes imposed on certain chemicals and substances under the U.S. tax code. These taxes, often called "Superfund taxes," were originally enacted to fund environmental cleanup efforts related to hazardous waste.
Key Provisions
- Repeal of Taxes: The bill amends Chapter 38 of the Internal Revenue Code of 1986 by removing Subchapter B (excise taxes on taxable chemicals, such as certain acids, metals, and organic compounds) and Subchapter C (excise taxes on taxable substances, which are products incorporating those chemicals).
- Effective Date: The repeal applies retroactively, taking effect on January 1, 2024, meaning taxes collected after this date would no longer be due, and any overpayments could potentially be refunded.
Significant Changes to Existing Law
- This directly eliminates two subchapters that have been part of the tax code since the 1980s, specifically targeting excise taxes that apply to manufacturers and importers of listed chemicals and products containing them (e.g., tires, batteries, or inks).
- No new taxes or alternative funding mechanisms are introduced; the change simply strikes these provisions from the law, reverting to a pre-existing state without these levies.
Potential Impacts
- On Government Agencies: The Internal Revenue Service (IRS) would see a reduction in tax collection and enforcement responsibilities for these specific excise taxes. The U.S. Treasury could face decreased revenue (estimated in the billions over time, based on prior collections), potentially affecting funding for environmental programs like the Superfund if not offset elsewhere.
- On Citizens and Businesses: Manufacturers, importers, and industries reliant on these chemicals (e.g., agriculture, automotive, and electronics sectors) would benefit from lower production costs, which could lead to reduced prices for consumers. Everyday taxpayers might indirectly gain through broader economic relief but could face impacts if federal budgets are strained.
- On International Relations: Minimal direct effects, though U.S. companies competing globally might gain a cost advantage, potentially influencing trade dynamics in chemical-dependent industries.
Main Stakeholders Affected
- Chemical and Manufacturing Industries: Primary beneficiaries, including producers of fertilizers, pharmaceuticals, and consumer goods, who would no longer pay these taxes on raw materials or finished products.
- Government Entities: The IRS and Environmental Protection Agency (EPA), as the taxes historically supported hazardous waste cleanup; revenue loss could shift burdens to general tax funds.
- Consumers and Taxpayers: Indirectly affected through potential price changes in goods and any adjustments to federal spending priorities.
Notable Legal, Constitutional, or Political Implications
- Legal: The retroactive effective date could lead to administrative challenges, such as processing refunds for taxes paid in 2024, but it aligns with congressional authority to amend tax laws. No challenges to due process or equal protection are evident in the bill text.
- Constitutional: Falls within Congress's enumerated power to levy taxes (Article I, Section 8), with no apparent conflicts.
- Political: Represents tax relief for specific industries, potentially sparking debates on environmental funding versus economic incentives; as an introduced bill in the 119th Congress, its passage would depend on committee approval and broader fiscal policy priorities.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Rep. Van Duyne, Beth [R-TX-24]
Cosponsors (9)
Rep. Carey, Mike [R-OH-15], Rep. LaHood, Darin [R-IL-16], Rep. Miller, Carol D. [R-WV-1], Rep. Hern, Kevin [R-OK-1], Rep. Weber, Randy K. Sr. [R-TX-14], Rep. Tenney, Claudia [R-NY-24], Rep. Kustoff, David [R-TN-8], Rep. Moran, Nathaniel [R-TX-1], Rep. Evans, Gabe [R-CO-8]
Recent Actions
- 2025-01-22: Referred to the House Committee on Ways and Means.
- 2025-01-22: Introduced in House
- 2025-01-22: Introduced in House
Bill Versions
- Chemical Tax Repeal Act — issued 2025-01-22 — PDF (2 pages)