II 109th CONGRESS 2d Session S. 2689 IN THE SENATE OF THE UNITED STATES May 1, 2006 Ms. Collins introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend the Internal Revenue Code of 1986 to increase certain alternative fuel and vehicle tax incentives and to eliminate certain tax incentives for major integrated oil companies, and for other purposes.
1.
Increase in certain alternative fuel and vehicle tax incentives
(a)
Incentives for alcohol fuels
(1)
Income tax credit
Section 40 of the Internal Revenue Code of 1986 (relating to alcohol used as fuel) is amended— (A)by striking 60 cents each place it appears and inserting $1.20, (B)by striking 45 cents each place it appears and inserting 90 cents, (C)by striking 2010 in the table contained in subsection (h)(2) and inserting 2006, and (D)by adding at the end of such table the following new item: 2007 through 2010$1.0275.56 cents
. (2)
Excise tax credit
Section 6426(b) of such Code (relating to alcohol fuel mixture credit) is amended— (A)by striking 51 cents in paragraph (2)(A) and inserting $1.02, and (B)by striking 60 cents in paragraph (2)(B) and inserting $1.20. (b)
Incentives for biodiesel and renewable diesel fuels
(1)
Income tax credit
Section 40A of the Internal Revenue Code of 1986 (relating to biodiesel and renewable diesel used as fuel) is amended— (A)by striking $1.00 each place it appears and inserting $2.00, (B)by striking 50 cents each place it appears and inserting $1.00, and (C)by striking 10 cents in subsection (b)(5)(A) and inserting 20 cents. (2)
Excise tax credit
Section 6426(c) of such Code (relating to biodiesel mixture credit) is amended— (A)by striking 50 cents in paragraph (2)(A) and inserting $1.00, and (B)by striking $1.00 in paragraph (2)(B) and inserting $2.00. (c)
Incentives for alternative fuels
Subsections (d)(1) and (e)(1) of section 6426 of such the Internal Revenue Code of 1986 (credit for alcohol fuel, biodiesel, and alternative fuel mixtures) are each amended by striking 50 cents and inserting $1.00. (d)
Alternative motor vehicle credit
(1)
New qualified fuel cell motor vehicle credit
Section 30B(b) of the Internal Revenue Code of 1986 is amended— (A)by striking $8,000, $4,000, $10,000, $20,000, and $40,000 in paragraph (1) and inserting $16,000, $8,000, $20,000, $40,000, and $80,000, respectively, and (B)by striking $1,000, $1,500, $2,000, $2,500, $3,000, $3,500, and $4,000 in paragraph (2) and inserting $2,000, $3,000, $4,000, $5,000, $6,000, $7,000, and $8,000, respectively. (2)
New advanced lean burn technology motor vehicle credit
Section 30B(c) of such Code is amended— (A)by striking $400, $800, $1,200, $1,600, $2,000, and $2,400 in the table contained in paragraph (2)(A)(i) and inserting $800, $1,600, $2,400, $3,200, $4,000, and $4,800, respectively, and (B)by striking $250, $500, $750, and $1,000 in the table contained in paragraph (2)(B) and inserting $500, $1,000, $1,500, and $2,000, respectively. (3)
New qualified hybrid motor vehicle credit
Section 30B(d)(2)(B)(iii) of such Code (relating to qualified incremental hybrid cost) is amended by striking by striking $7,500, $15,000, and $30,000 and inserting $15,000, $30,000, and $60,000, respectively. (4)
New qualified alternative fuel motor vehicle credit
Section 30B(e)(3) of such Code (relating to incremental cost) is amended by striking by striking $5,000, $10,000, $25,000, and $40,000 and inserting $10,000, $20,000, $50,000, and $80,000, respectively. (e)
Alternative fuel vehicle refueling property credit
Section 30C(b) of the Internal Revenue Code of 1986 (relating to limitation) is amended— (1)by striking $30,000 in paragraph (1) and inserting $60,000, and (2)by striking $1,000 in paragraph (2) and inserting $2,000. (f)
Effective dates
(1)
Fuels
The amendments made by subsections (a), (b), and (c) shall apply to any sale, use, or removal for any period after the date of the enactment of this Act. (2)
Vehicles and refueling property
The amendments made by subsections (d) and (e) shall apply to property placed in service after the date of the enactment of this Act.
2.
Elimination of certain tax incentives for major integrated oil companies
(a)
Amortization of geological and geophysical expenditures
(1)
In general
Section 167(h) of the Internal Revenue Code of 1986 (relating to amortization of geological and geophysical expenditures) is amended by adding at the end the following new paragraph: (5)
Nonapplication to major integrated oil companies
This subsection shall not apply to any sale during any taxable year by a taxpayer which is— (A)an integrated oil company (as defined in section 291(b)(4)) which has an average daily worldwide production of crude oil of at least 500,000 barrels for such taxable year, or (B)a related person to such company. . (2)
Effective date
The amendment made by this subsection shall apply to amounts paid or incurred in taxable years beginning after the date of the enactment of this Act. (b)
Percentage depletion allowance for oil and gas properties
(1)
In general
Section 613A is amended by adding at the end the following new subsection: (f)
Nonapplication to major integrated oil companies
The allowance for percentage depletion shall be zero during any taxable year with respect to a taxpayer which is— (1)an integrated oil company (as defined in section 291(b)(4)) which has an average daily worldwide production of crude oil of at least 500,000 barrels for such taxable year, or (2)a related person to such company. . (2)
Effective date
The amendment made by this subsection shall apply to taxable years beginning after the date of the enactment of this Act. (c)
Deduction for intangible drilling and development costs
(1)
In general
Section 263(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new sentence: This subsection shall not apply during any taxable year with respect to a taxpayer which is an integrated oil company (as defined in section 291(b)(4)) which has an average daily worldwide production of crude oil of at least 500,000 barrels for such taxable year or a related person to such company.. (2)
Effective date
The amendment made by this subsection shall apply to amounts paid or incurred in taxable years beginning after the date of the enactment of this Act.
3.
Prohibition of funds for oil and natural gas royalty relief
(a)
In general
No funds made available under any Act for any fiscal year for royalty and offshore minerals management may be used by the Secretary of the Interior to provide relief from a requirement to pay a royalty for the production of oil or natural gas from Federal land during any period in which— (1)for the production of oil, the average price of crude oil in the United States is greater than $55 a barrel; and (2)for the production of natural gas, the average price of natural gas in the United States is $10 per 1,000 cubic feet of natural gas. (b)
Exception
In administering funds made available for royalty or offshore minerals management, the Secretary of the Interior may waive or specify alternative requirements if the Secretary of the Interior determines that royalty relief is necessary to avoid oil or natural gas supply disruptions as a consequence of hurricanes or other natural disasters.