[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1628 Introduced in House (IH)]

112th CONGRESS
  1st Session
                                H. R. 1628

 To amend the Internal Revenue Code of 1986 to impose a retail tax on 
           disposable carryout bags, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             April 15, 2011

 Mr. Moran (for himself and Ms. Norton) introduced the following bill; 
which was referred to the Committee on Ways and Means, and in addition 
to the Committee on Natural Resources, 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 impose a retail tax on 
           disposable carryout bags, and for other purposes.

    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 ``Trash Reduction Act of 2011''.

SEC. 2. IMPOSITION OF TAX ON DISPOSABLE CARRYOUT BAGS.

    (a) General Rule.--Chapter 31 of the Internal Revenue Code of 1986 
(relating to retail excise taxes) is amended by inserting after 
subchapter C the following new subchapter:

                ``Subchapter D--Disposable Carryout Bags

``Sec. 4056. Imposition of tax.

``SEC. 4056. IMPOSITION OF TAX.

    ``(a) General Rule.--There is hereby imposed on any retail sale a 
tax on each disposable carryout bag.
    ``(b) Amount of Tax.--The amount of tax imposed by subsection (a) 
shall be $0.05 per disposable carryout bag.
    ``(c) Liability for Tax.--The retailer shall be liable for the tax 
imposed by this section.
    ``(d) Definitions.--For purposes of this section--
            ``(1) Disposable carryout bag.--
                    ``(A) In general.--The term `disposable carryout 
                bag' means a bag of any material, commonly plastic or 
                kraft paper, which is provided to a consumer at the 
                point of sale to carry or cover purchases, merchandise, 
                or other items.
                    ``(B) Exceptions.--Such term does not include--
                            ``(i) any reusable bag,
                            ``(ii) any bag manufactured for use by a 
                        customer inside a store to package bulk items 
                        such as fruit, vegetables, nuts, grains, candy, 
                        or small hardware items, such as nails and 
                        bolts,
                            ``(iii) any bag that contains or wraps 
                        frozen foods, prepared foods, or baked goods 
                        when not prepackaged,
                            ``(iv) any bag manufactured for use by a 
                        pharmacist to contain prescription drugs, and
                            ``(v) any bag manufactured to be sold at 
                        retail in packages containing multiple bags 
                        intended for use as garbage, pet waste, or yard 
                        waste bags.
            ``(2) Reusable bag.--The term `reusable bag' means a bag 
        that is--
                    ``(A)(i) made of cloth or other machine washable 
                fabric, or
                    ``(ii) made of a durable plastic that is at least 
                2.25 millimeters thick, and
                    ``(B) is specifically designed and manufactured for 
                multiple use.
    ``(e) Special Rules.--
            ``(1) Pass through of tax.--The tax imposed by subsection 
        (a) shall be passed through to the customer and shall be 
        separately stated on the receipt of sale provided to the 
        customer.
            ``(2) 1st retail sale; use treated as sale.--For purposes 
        of this section, rules similar to the rules of subsections (a) 
        and (b) of section 4002 shall apply.''.
    (b) Carryout Bag Recycling Program.--Subchapter B of chapter 65 of 
such Code is amended by adding at the end the following new section:

``SEC. 6433. QUALIFIED DISPOSABLE CARRYOUT BAG RECYCLING PROGRAM.

    ``(a) Allowance of Credit.--If--
            ``(1) tax has been imposed under section 4056 on any 
        disposable carryout bag,
            ``(2) a retailer provides such bag to a customer in a point 
        of sale transaction,
            ``(3) such retailer has in effect at the time of such 
        transaction a qualified carryout bag recycling program, and
            ``(4) such retailer has kept and can produce records for 
        purposes of this section and section 4056 that include the 
        total number of disposable carryout bags purchased and the 
        amounts passed through to the customer for such bags pursuant 
        to section 4056(e),
the Secretary shall pay (without interest) to such retailer an amount 
equal to the applicable amount for each such bag used by the retailer 
in connection with a point of sale transaction.
    ``(b) Applicable Amount.--For purposes of subsection (a), the 
applicable amount is $0.01.
    ``(c) Qualified Disposable Carryout Bag Recycling Program.--For 
purposes of this section--
            ``(1) In general.--The term `qualified carryout bag 
        recycling program' means a recycling program under which the 
        retailer--
                    ``(A) to the extent the retailer provides 
                disposable carryout bags (as defined in section 4056) 
                to customers--
                            ``(i) passes through the tax imposed by 
                        section 4056 and tracks the total number of 
                        bags purchased and amount of tax passed through 
                        pursuant to section 6433(a),
                            ``(ii) has printed or displayed on each 
                        such bag, in a manner clearly visible to a 
                        customer, the words `PLEASE RETURN TO A 
                        PARTICIPATING STORE FOR RECYCLING',
                            ``(iii) uses bags that are 100 percent 
                        recyclable,
                            ``(iv) uses bags that are made of high-
                        density polyethylene film marked with the SPI 
                        resin identification code 2 or low-density 
                        polyethylene film marked with the SPI resin 
                        identification code 4, and
                            ``(v) uses bags that contain a minimum of 
                        40 percent post-consumer recycled content,
                    ``(B) places at each place of business at which 
                retail operations are conducted one or more carryout 
                bag collection bins which are visible, easily 
                accessible to the customer, and clearly marked as being 
                for the purpose of collecting and recycling disposable 
                carryout bags,
                    ``(C) recycles the disposable carryout bags 
                collected pursuant to subparagraph (B),
                    ``(D) maintains for not less than 3 years records 
                (which shall be available to the Secretary) describing 
                the collection, transport, and recycling of disposable 
                carryout bags collected,
                    ``(E) makes available to customers within the 
                retail establishment reusable bags (as defined in 
                section 4056(c)(2)) which may be purchased and used in 
                lieu of using a disposable carryout bag, and
                    ``(F) meets the definition of 4056(d)(3).
            ``(2) Recycling program.--The term `recycling program' 
        means a program that processes used materials or waste 
        materials into new products to prevent waste of potentially 
        useful materials; reduce raw materials consumption; reduce 
        energy usage; reduce air, water, or other pollution; or reduce 
        the need for disposal.''.
    (c) Establishment of Trust Fund.--Subchapter A of chapter 98 of 
such Code (relating to trust fund code) is amended by adding at the end 
the following:

``SEC. 9512. DISPOSABLE CARRYOUT BAG TRUST FUND.

    ``(a) Creation of Trust Fund.--There is established in the Treasury 
of the United States a trust fund to be known as the `Disposable 
carryout bag Trust Fund' (referred to in this section as the `Trust 
Fund'), consisting of such amounts as may be appropriated or credited 
to the Trust Fund as provided in this section or section 9602(b).
    ``(b) Transfers to Trust Fund.--There is hereby appropriated to the 
Trust Fund an amount equivalent to the amounts received in the Treasury 
pursuant to section 4056.
    ``(c) Expenditures From Trust Fund.--Amounts in the Trust Fund 
shall be available, as provided by appropriation Acts, for making 
payments under section 6433.
    ``(d) Transfer to Land and Water Conservation Fund.--
            ``(1) In general.--The Secretary shall pay from time to 
        time from the Trust Fund into the land and water conservation 
        fund provided for in title I of the Land and Water Conservation 
        Fund Act of 1965 amounts (as determined by the Secretary) 
        equivalent to the aggregate of the transactions on which tax is 
        imposed under section 4056 aggregate amounts determined on the 
        basis of $0.01.
            ``(2) Special rule regarding amounts transferred.--Amounts 
        transferred to the land and water conservation fund under 
        paragraph (1) shall not be taken into account for purposes of 
        determining amounts to be appropriated or credited to the fund 
        under section 2(c) of the Land and Water Conservation Fund Act 
        of 1965 (16 U.S.C. 460l-5(c)).''.
    (d) Study.--Not later than December 31, 2013, the Comptroller 
General of the United States shall conduct a study on the effectiveness 
of the provisions of this Act at reducing the use of disposable 
carryout bags and encouraging recycling of such bags. The report 
shall--
            (1) address measures that the Comptroller General 
        determines may increase the effectiveness of such provisions, 
        including the amount of tax imposed on each disposable carryout 
        bag, and
            (2) any effects, both positive and negative, on any United 
        States businesses. The Comptroller General shall submit a 
        report of such study to the Committee on Ways and Means of the 
        House of Representatives and the Committee on Finance of the 
        Senate.
    (e) Clerical Amendments.--
            (1) The table of subchapters for chapter 31 of such Code is 
        amended by inserting after the item relating to adding at the 
        end thereof the following new item:

``Subchapter D. Disposable carryout bags.''.
            (2) The table of sections for subchapter B of chapter 65 of 
        such Code is amended by adding at the end the following new 
        item:

``Sec. 6433. Qualified disposable carryout bag recycling program.''.
            (3) The table of sections for subchapter A of chapter 98 of 
        such Code is amended by adding at the end the following new 
        item:

``Sec. 9512. Disposable carryout bag trust fund.''.
    (f) Effective Date.--The amendments made by this section shall take 
effect on January 1, 2011.
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