PFAS Cleanup Act

Bill Number

H.R. 8632

Origin Chamber

House

Congress

119th Congress, Session 2

Policy Area

Taxation

Status

Introduced

Latest Action

2026-04-30: Referred to the House Committee on Ways and Means.

Last Updated

2026-05-27T08:05:50Z

AI-Generated Summary

Purpose

The PFAS Cleanup Act (H.R. 8632) aims to address pollution from perfluoroalkyl and polyfluoroalkyl substances (PFAS)—man-made chemicals with at least one fully fluorinated carbon atom, often called "forever chemicals" due to their persistence in the environment. It imposes an excise tax on PFAS sales to generate revenue for cleanup costs and provides a tax credit to encourage removal of PFAS from public drinking water systems.

Key Provisions

• Congressional Findings: Recognizes PFAS pollution's health harms and high costs, estimated at up to $60 billion annually for health impacts and $7–30 million per pound for removal from drinking water. Revenue from the tax would support state and local accountability efforts.
• Excise Tax on PFAS (New IRC Subchapter E):
• 45% tax on the sale price of PFAS by manufacturers, producers, or importers.
• Applies to PFAS made or imported into the U.S. for consumption, use, or storage.
• Using PFAS (instead of selling it) is treated as a sale at fair market value.
• Exempts special revenue rules for Puerto Rico and the Virgin Islands.
• Effective for taxable years beginning after December 31, 2026.
• PFAS Water Remediation Credit (New IRC Section 45BB):
• 25% tax credit for qualified expenditures to remove "hazardously excessive" PFAS from public water systems (defined under the Safe Drinking Water Act as systems exceeding EPA maximum contaminant levels).
• Available to owners or operators of public water systems (surface or groundwater).
• Part of the general business credit; eligible for elective payment (direct refund).
• Controlled group rules apply to prevent abuse.
• Effective for taxable years beginning after December 31, 2026.
• Regulations: Treasury Secretary, consulting EPA Administrator, to issue guidance.

Significant Changes to Existing Law

• Adds Subchapter E to Chapter 38 of the Internal Revenue Code (IRC) for the PFAS excise tax.
• Adds Section 45BB to IRC Subpart D (business credits) and updates Sections 38(b) and 6417(b) to include the new credit.
• First federal excise tax specifically targeting PFAS sales, complementing state regulations.

Potential Impacts

• Government Agencies: IRS administers tax/credit; EPA consulted on definitions and guidance; revenue could fund broader PFAS response without new appropriations.
• Citizens: Cleaner public drinking water via incentivized remediation; potential indirect costs passed on through higher product prices (e.g., in consumer goods using PFAS).
• International Relations: Tax on imports may affect trade with PFAS-exporting countries, but no direct foreign policy changes.
• Overall, shifts some pollution costs to producers/importers while subsidizing water cleanup.

Main Stakeholders Affected

• PFAS Manufacturers, Producers, and Importers: Bear the 45% tax liability, potentially raising their costs.
• Public Water System Owners/Operators (e.g., municipalities, utilities): Eligible for 25% credit on remediation expenses.
• Taxpayers and Businesses: General business credit integration affects corporate tax planning.
• Communities Near PFAS Sites: Benefit from reduced contamination risks.
• EPA and States: Supports regulatory efforts without overriding them.

Notable Legal, Constitutional, or Political Implications

• Legal: Relies on IRC amendments for tax authority; definitions tie to Safe Drinking Water Act standards, ensuring consistency. Requires EPA-Treasury coordination for implementation.
• Constitutional: Excise taxes on sales are standard (Article I, Section 8); no apparent due process or takings issues.
• Political: Uses tax policy for environmental goals ("polluter pays" principle); bipartisan potential on public health but may face industry opposition over tax burden. Complements (does not replace) litigation or regulation.

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

Sponsor

Rep. Sánchez, Linda T. [D-CA-38]

Cosponsors (4)

Rep. Davis, Danny K. [D-IL-7], Rep. Kamlager-Dove, Sydney [D-CA-37], Del. Norton, Eleanor Holmes [D-DC-At Large], Rep. Grijalva, Adelita S. [D-AZ-7]

Recent Actions

• 2026-04-30: Referred to the House Committee on Ways and Means.
• 2026-04-30: Introduced in House
• 2026-04-30: Introduced in House

Bill Versions

• PFAS Cleanup Act — issued 2026-04-30 — PDF (7 pages)