[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2380 Introduced in House (IH)]

111th CONGRESS
  1st Session
                                H. R. 2380

 To amend the Internal Revenue Code of 1986 to reduce social security 
 payroll taxes and to reduce the reliance of the United States economy 
                    on carbon-based energy sources.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 13, 2009

 Mr. Inglis (for himself, Mr. Lipinski, and Mr. Flake) introduced the 
following bill; which was referred to the Committee on Ways and Means, 
     and in addition to the Committee on Rules, 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

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to reduce social security 
 payroll taxes and to reduce the reliance of the United States economy 
                    on carbon-based energy sources.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Raise Wages, Cut Carbon Act of 
2009''.

SEC. 2. REDUCTION OF SOCIAL SECURITY TAXES; TAX ON COMBUSTIBLE FOSSIL 
              FUELS.

    (a) In General.--Chapter 38 of the Internal Revenue Code of 1986 
(relating to environmental taxes) is amended by adding at the end 
thereof the following new subchapter:

``Subchapter E--Reduction of Social Security Taxes; Tax on Combustible 
                              Fossil Fuels

     ``Part I. Carbon Tax Revenues To Offset Social Security Taxes.

              ``Part II. Tax on Combustible Fossil Fuels.

       ``Part III. Tax on Certain Additional Imported Substances.

     ``Part IV. Supermajority Required To Change Revenue Neutrality

     ``PART I--CARBON TAX REVENUES TO OFFSET SOCIAL SECURITY TAXES

``Sec. 4691. Disposition of revenues.

``SEC. 4691. DISPOSITION OF REVENUES.

    ``(a) Amounts Appropriated to Social Security Trust Funds.--
            ``(1) In general.--There are hereby appropriated to the 
        social security trust funds an amount equal to the net revenues 
        received in the Treasury from the taxes imposed by parts II and 
        III.
            ``(2) Allocation among funds.--Amounts shall be 
        appropriated to such funds under paragraph (1) in the same 
        proportions as amounts would (but for this subchapter) be 
        appropriated to such funds under the Social Security Act and 
        the Railroad Retirement Act of 1974.
    ``(b) Reduction in Social Security Taxes.--
            ``(1) In general.--The rate of each social security tax for 
        each calendar year (determined without regard to this section) 
        shall be reduced by the number of percentage points equal to--
                    ``(A) such rate, multiplied by
                    ``(B) the reduction percentage determined by the 
                Secretary for such year.
            ``(2) Reduction percentage.--The reduction percentage 
        determined by the Secretary under paragraph (1) for any 
        calendar year shall be the highest percentage which the 
        Secretary estimates will result in deposits into each trust 
        fund equal to the amount which would (without regard to this 
        section) be appropriated to each trust fund for such year on 
        account of social security taxes.
    ``(c) Increase in Payments to Social Security Recipients for 2010 
To Offset Cost of Carbon Tax Before Tax Reflected in Cost-of-Living 
Adjustments.--The Secretary shall notify the Managing Trustee of the 
Federal Old-Age and Survivors Insurance Trust Fund established under 
section 201 of the Social Security Act to increase the payments to 
which an individual is entitled under section 205(i) of such Act for 
2010 by the average cost of the taxes imposed by parts II and III which 
is borne by individuals who are so entitled by reason of price 
increases in the costs of products and services.
    ``(d) Definitions.--For purposes of this subchapter--
            ``(1) Social security tax.--The term `social security tax' 
        means--
                    ``(A) the tax imposed by section 3101(a) (and so 
                much of the tax imposed by section 3201(a) as is 
                determined by reference to the tax imposed by section 
                3101(a)),
                    ``(B) the tax imposed by section 3111(a) (and so 
                much of the tax imposed by section 3221(a) as is 
                determined by reference to the tax imposed by section 
                3111(a)), and
                    ``(C) the tax imposed by section 1401(a) (and so 
                much of the tax imposed by section 3211(a) as is 
                determined by reference to the taxes imposed by 
                sections 3101(a) and 3111(a)).
            ``(2) Social security trust fund.--The term `social 
        security trust fund' means--
                    ``(A) the Federal Old-Age and Survivors Insurance 
                Trust Fund established by section 202 of the Social 
                Security Act, and
                    ``(B) the Social Security Equivalent Benefit 
                Account established under section 15A of the Railroad 
                Retirement Act of 1974.
    ``(e) Determination Based on Estimates.--Determination under 
subsections (a) and (b) shall be made on the basis of estimates by the 
Secretary. Proper adjustments shall be made to the extent prior 
estimates were in excess of or less than more accurate amounts.
    ``(f) Publication of Rate Reductions.--Any adjustment under this 
section of social security tax rates for any calendar year shall be 
published in the Federal Register on or before November 1 of the 
preceding calendar year.

               ``PART II--TAX ON COMBUSTIBLE FOSSIL FUELS

``Sec. 4692. Imposition of tax.
``Sec. 4693. Refunds or credits.
``Sec. 4694. Other definitions and special rules.

``SEC. 4692. IMPOSITION OF TAX.

    ``(a) In General.--There is hereby imposed a tax on any taxable 
carbon substance sold by the manufacturer, producer, or importer 
thereof.
    ``(b) Amount of Tax.--
            ``(1) In general.--The amount of tax imposed by subsection 
        (a) on any taxable carbon substance shall be the applicable 
        amount per ton of the carbon dioxide emissions potential of 
        such substance, as determined by the Secretary in consultation 
        with the Secretary of Energy.
            ``(2) Fractional part of ton.--In the case of a fraction of 
        a ton, the tax imposed by subsection (a) shall be the same 
        fraction of the amount of such tax imposed on a whole ton.
            ``(3) Applicable amount.--For purposes of paragraph (1)--
                    ``(A) In general.--The applicable amount for any 
                calendar year is the amount determined under the 
                following table for such year, as adjusted under 
                subparagraph (B):


``In the case of calendar year--                          The applicable
                                                             amount is--
  2010.............................................              $ 15.00
  2011.............................................                15.98
  2012.............................................                17.02
  2013.............................................                18.13
  2014.............................................                19.32
  2015.............................................                20.58
  2016.............................................                21.92
  2017.............................................                23.35
  2018.............................................                24.88
  2019.............................................                26.50
  2020.............................................                28.23
  2021.............................................                30.07
  2022.............................................                32.04
  2023.............................................                34.13
  2024.............................................                36.36
  2025.............................................                38.73
  2026.............................................                41.26
  2027.............................................                43.95
  2028.............................................                46.82
  2029.............................................                49.88
  2030.............................................                53.13
  2031.............................................                56.60
  2032.............................................                60.30
  2033.............................................                64.23
  2034.............................................                68.43
  2035.............................................                72.89
  2036.............................................                77.65
  2037.............................................                82.72
  2038.............................................                88.12
  2039.............................................                93.87
  2040 or thereafter...............................              100.00.
 

                    ``(B) Inflation adjustment.--
                            ``(i) In general.--The applicable amount 
                        contained in the table under subparagraph (A) 
                        for any calendar year after 2010 shall be 
                        increased by an amount equal to--
                                    ``(I) such applicable amount, 
                                multiplied by
                                    ``(II) the cost-of-living 
                                adjustment determined under section 
                                1(f)(3) for such calendar year, 
                                determined by substituting `calendar 
                                year 2009' for `calendar year 1992' in 
                                subparagraph (B) thereof.
                            ``(ii) Rounding.--Any increase determined 
                        under clause (i) shall be rounded to the 
                        nearest cent.
    ``(c) Taxable Carbon Substance.--For purposes of this subchapter, 
the term `taxable carbon substance' means--
            ``(1) coal (including lignite and peat),
            ``(2) petroleum and any petroleum product (as defined in 
        section 4612(a)(3)), and
            ``(3) natural gas,
which is extracted, manufactured, or produced in the United States or 
entered into the United States for consumption, use, or warehousing.
    ``(d) Substance Taxed Only Once.--No tax shall be imposed by 
subsection (a) with respect to a taxable carbon substance if the person 
who would be liable for such tax establishes that a prior tax imposed 
by such section has been imposed with respect to such substance.

``SEC. 4693. REFUNDS OR CREDITS.

    ``(a) Sequestered Carbon.--Under regulations prescribed by the 
Secretary, if a person uses a taxable carbon substance so that the 
carbon associated with such substance will not be emitted, then an 
amount equal to the amount of tax in effect under section 4692(b) with 
respect to such substance for the calendar year in which such use 
begins shall be allowed as a credit or refund (without interest) to 
such person in the same manner as if it were an overpayment of tax 
imposed by section 4692.
    ``(b) Previously Taxed Carbon Substances Used To Make Another 
Taxable Carbon Substance.--Under regulations prescribed by the 
Secretary, if--
            ``(1) a tax under section 4692 was paid with respect to any 
        taxable carbon substance, and
            ``(2) such substance was used by any person in the 
        manufacture or production of any other substance which is a 
        taxable carbon substance,
then an amount equal to the tax so paid shall be allowed as a credit or 
refund (without interest) to such person in the same manner as if it 
were an overpayment of tax imposed by section 4692. In any case to 
which this subsection applies, the amount of any such credit or refund 
shall not exceed the amount of tax imposed by section 4692 on the other 
taxable fuel manufactured or produced (or which would have been imposed 
by such subsection on such other fuel but for section 4692(d)).
    ``(c) Exemption for Exports.--
            ``(1) Tax-free sales.--
                    ``(A) In general.--No tax shall be imposed under 
                subsection (a) on the sale by the manufacturer or 
                producer of any taxable carbon substance for export or 
                for resale by the purchaser to a second purchaser for 
                export.
                    ``(B) Proof of export required.--Rules similar to 
                the rules of section 4221(b) shall apply for purposes 
                of subparagraph (A).
            ``(2) Credit or refund.--If--
                    ``(A) any person exports--
                            ``(i) a taxable carbon substance, or
                            ``(ii) any other product any portion of the 
                        cost of which is attributable to the use of any 
                        taxable carbon substance as an energy source 
                        for the manufacture or production of such 
                        product, and
                    ``(B) such person establishes to the satisfaction 
                of the Secretary the portion of such cost which is 
                attributable to the tax under section 4692,
        credit or refund (without interest) of such tax shall be 
        allowed or made to such person.
            ``(3) Regulations.--The Secretary shall prescribe such 
        regulations as may be necessary to carry out the purposes of 
        this subsection.

``SEC. 4694. OTHER DEFINITIONS AND SPECIAL RULES.

    ``(a) Definitions.--For purposes of this subchapter--
            ``(1) United states.--The term `United States' has the 
        meaning given such term by section 4612(a)(4).
            ``(2) Importer.--The term `importer' means the person 
        entering the article for consumption, use, or warehousing.
            ``(3) Ton.--The term `ton' means 2,000 pounds. In the case 
        of any taxable carbon substance which is a gas, the term `ton' 
        means the amount of such gas in cubic feet which is the 
        equivalent of 2,000 pounds on a molecular weight basis.
    ``(b) Use Treated as Sale.--If any person manufactures, produces, 
or imports any taxable carbon substance and uses such substance, then 
such person shall be liable for tax under section 4692 in the same 
manner as if such substance were sold by such person.
    ``(c) Special Rules for Inventory Exchanges.--
            ``(1) In general.--Except as provided in paragraph (2), in 
        any case in which a manufacturer, producer, or importer of a 
        taxable carbon substance exchanges such substance as part of an 
        inventory exchange with another person--
                    ``(A) such exchange shall not be treated as a sale, 
                and
                    ``(B) such other person shall, for purposes of 
                section 4692, be treated as the manufacturer, producer, 
                or importer of such substance.
            ``(2) Registration requirement.--Paragraph (1) shall not 
        apply to any inventory exchange unless--
                    ``(A) both parties are registered with the 
                Secretary as manufacturers, producers, or importers of 
                taxable carbon substances, and
                    ``(B) the person receiving the taxable carbon 
                substance has, at such time as the Secretary may 
                prescribe, notified the manufacturer, producer, or 
                importer of such person's registration number and the 
                internal revenue district in which such person is 
                registered.
            ``(3) Inventory exchange.--For purposes of this subsection, 
        the term `inventory exchange' means any exchange in which 2 
        persons exchange property which is, in the hands of each 
        person, property described in section 1221(a)(1).

        ``PART III--TAX ON CERTAIN ADDITIONAL IMPORTED PRODUCTS

``Sec. 4695. Imposition of tax.
``Sec. 4696. Imported taxable product.

``SEC. 4695. IMPOSITION OF TAX.

    ``(a) In General.--There is hereby imposed a tax on any imported 
taxable product sold or used by the importer thereof.
    ``(b) Amount of Tax.--The amount of the tax imposed by subsection 
(a) with respect to any imported taxable product shall be the 
applicable amount under section 4692 per ton on the lesser of--
            ``(1) the taxable carbon substances used in the manufacture 
        or production of such product, or
            ``(2) the carbon dioxide emissions attributable to the 
        manufacture or production of such product.
    ``(c) Procedure To Challenge Information Provided by Importer.--The 
Secretary shall establish a procedure under which interested persons 
may examine the information provided by an importer for purposes of 
this section, and bring to the attention of the Secretary any suspected 
errors in such information.

``SEC. 4696. IMPORTED TAXABLE PRODUCT.

    ``(a) In General.--For purposes of this part, the term `imported 
taxable product' means any article which, at the time of such article's 
sale or use by the importer, is described in the same heading of the 
Harmonized Tariff Schedule of the United States as a like article 
produced in a listed industry.
    ``(b) Listed Industry.--For purposes of this section--
            ``(1) In general.--Except as provided in paragraph (2), the 
        term `listed industry' means any industry listed by the 
        Administrator as being among the industries which, in the 
        aggregate, account for 95 percent of the taxable carbon 
        substances used in the United States. An industry may not be 
        omitted from the list under the preceding sentence if it uses 
        more taxable carbon substances per unit of output than any 
        industry which is so listed.
            ``(2) Special rule for 2010 through 2012.--
                    ``(A) 2010.--During 2010, the term `listed 
                industry' shall include only the 6 industries on the 
                list under paragraph (1) having the highest average use 
                of taxable carbon substances per unit of output.
                    ``(B) 2011 and 2012.--During 2011 and 2012, the 
                term `listed industry' shall include only--
                            ``(i) the industries described in 
                        subparagraph (A), and
                            ``(ii)(I) in the case of 2011, the \1/3\ of 
                        the remaining industries on such list having 
                        the highest average use of taxable carbon 
                        substances per unit of output, or
                            ``(II) in the case of 2012, the \2/3\ of 
                        the remaining industries on such list having 
                        the highest average use of taxable carbon 
                        substances per unit of output.
    ``(c) Other Definitions.--For purposes of this part, the terms 
`importer', `taxable carbon substance', and `United States' have the 
respective meanings given such terms by part II.

     ``PART IV--SUPERMAJORITY REQUIRED TO CHANGE REVENUE NEUTRALITY

``SEC. 4697. SUPERMAJORITY REQUIRED.

    ``A bill, joint resolution, amendment to a bill or joint 
resolution, or conference report that increases aggregate revenues 
under parts II and III greater than the aggregate reduction in revenues 
under part I may not be considered as passed or agreed to by the House 
of Representatives or the Senate unless so determined by a vote of not 
less than two-thirds of the Members of the House of Representatives or 
the Senate (as the case may be) voting, a quorum being present.''.
    (b) Clerical Amendment.--The table of subchapters for chapter 38 of 
such Code is amended by adding at the end the following new item:

``subchapter f. reduction of social security taxes; tax on combustible 
                            fossil fuels''.

    (c) Effective Date.--The amendments made by this section shall take 
effect on January 1, 2010.
                                 <all>