117 HR 7099 IH: Stop Gas Price Gouging Tax and Rebate Act
U.S. House of Representatives
2022-03-16
text/xml
EN
Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.
I
117th CONGRESS
2d Session
H. R. 7099
IN THE HOUSE OF REPRESENTATIVES
March 16, 2022
Mr. DeFazio (for himself, Mr. Takano, Ms. Tlaib, Ms. Porter, Mr. Carson, Mr. Cohen, Ms. Kaptur, Mr. García of Illinois, Ms. Titus, Mr. Jones, Ms. Ross, Mr. Grijalva, Mr. Welch, Mr. Malinowski, Ms. Jayapal, Ms. Underwood, Ms. Pingree, and Ms. Barragán) introduced the following bill; which was referred to the Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to establish a windfall profits excise tax on crude oil and to rebate the tax collected back to individual taxpayers, and for other purposes.
1.

Short title
This Act may be cited as the “Stop Gas Price Gouging Tax and Rebate Act”.
2.

Windfall profits tax
(a)

In general
Subtitle E of the Internal Revenue Code of 1986 (relating to alcohol, tobacco, and certain other excise taxes) is amended by adding at the end thereof the following new chapter:
“56

Windfall profits on crude oil
Sec. 5896. Imposition of tax.
Sec. 5897. Windfall profit.
Sec. 5898. Special rules and definitions.
5896.

Imposition of tax
(a)

In general
In addition to any other tax imposed under this title, there is hereby imposed on any applicable taxpayer an excise tax in an amount equal to 50 percent of the excess of the windfall profit (as defined in section 5897(a)) of such taxpayer.
(b)

Applicable taxpayer
For purposes of this chapter, the term applicable taxpayer means, with respect to a taxable year, a producer of crude oil—
(1)
which has an average daily worldwide production of crude oil of at least 300,000 barrels for the taxable year, and
(2)
which had gross receipts in excess of $1,000,000,000 for its last taxable year ending during calendar year 2005.
For purposes of this subsection, all persons treated as a single employer under subsections (a) and (b) of section 52 shall be treated as 1 person and, in case of a short taxable year, the rule under section 448(c)(3)(B) shall apply.
5897.

Windfall profit
(a)

General rule
For purposes of this chapter, the term windfall profit means the excess of the adjusted taxable income of the applicable taxpayer for taxable year 2022 over the reasonably inflated average profit for such taxable year.
(b)

Adjusted taxable income
For purposes of this chapter, with respect to any applicable taxpayer, the adjusted taxable income for taxable year 2022 is equal to the taxable income for such taxable year (within the meaning of section 63 and determined without regard to this subsection)—
(1)
increased by any interest expense deduction, charitable contribution deduction, and any net operating loss deduction carried forward from any prior taxable year, and
(2)
reduced by any interest income, dividend income, and net operating losses to the extent such losses exceed taxable income for the taxable year.
In the case of any applicable taxpayer which is a foreign corporation, the adjusted taxable income shall be determined with respect to such income which is effectively connected with the conduct of a trade or business in the United States.
(c)

Reasonably inflated average profit
For purposes of this chapter, with respect to any applicable taxpayer, the reasonably inflated average profit for any taxable year is an amount equal to the average of the adjusted taxable income of such taxpayer for taxable years beginning during the 2015–2019 taxable year period (determined without regard to the taxable year with the highest adjusted taxable income in such period) plus 10 percent of such average.
5898.

Special rules and definitions
(a)

Withholding and deposit of tax
The Secretary shall provide such rules as are necessary for the withholding and deposit of the tax imposed under section 5896.
(b)

Records and information
Each taxpayer liable for tax under section 5896 shall keep such records, make such returns, and furnish such information as the Secretary may by regulations prescribe.
(c)

Return of windfall profit tax
The Secretary shall provide for the filing and the time of such filing of the return of the tax imposed under section 5896.
(d)

Crude oil
The term crude oil includes crude oil condensates and natural gasoline.
(e)

Businesses under common control
For purposes of this chapter, all members of the same controlled group of corporations (within the meaning of section 267(f)) and all persons under common control (within the meaning of section 52(b) but determined by treating an interest of more than 50 percent as a controlling interest) shall be treated as 1 person.
(f)

Regulations
The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this chapter.”.
(b)

Clerical amendment
The table of chapters for subtitle E of the Internal Revenue Code of 1986 is amended by adding at the end the following new item:
“Chapter 56. Windfall profit on crude oil.” .
(c)

Deductibility of windfall profit tax
The first sentence of section 164(a) of the Internal Revenue Code of 1986 (relating to deduction for taxes) is amended by inserting after paragraph (5) the following new paragraph:
“(6)
The windfall profit tax imposed by section 5896.”.
(d)

Effective date
The amendments made by this section shall apply to taxable years beginning after December 31, 2021.
3.

Energy price rebates
(a)

In general
Subchapter B of chapter 65 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:
“6433.

Energy price rebates
(a)

In general
In the case of an eligible individual, there shall be allowed as a credit against the tax imposed by subtitle A for taxable year 2022 an amount equal to the sum of the energy price rebate amount for each month beginning in such taxable year.
(b)

Energy price rebate amount
For purposes of this section—
(1)

In general
The term energy price rebate amount means, with respect to any taxpayer for any month beginning in taxable year 2022, an amount determined by the Secretary as soon as practicable after the end of such month taking into account the number of eligible individuals and the amount of revenues in the general fund resulting from the tax imposed by section 5896 for such month.
(2)

Special rule for joint returns
In the case of an eligible individual filing a joint return, the energy price rebate amount shall be 150 percent of the amount determined under paragraph (1) with respect to other taxpayers.
(3)

Limitation based on adjusted gross income
The amount of the credit allowed by subsection (a) (determined without regard to this subsection and subsection (e)) shall be reduced (but not below zero) by 5 percent of so much of the eligible individual's adjusted gross income as exceeds—
(A)
$150,000 in the case of a joint return,
(B)
$112,500 in the case of a head of household, and
(C)
$75,000 in any other case.
(c)

Eligible individual
For purposes of this section, the term eligible individual means any individual other than—
(1)
any nonresident alien individual,
(2)
any individual who is a dependent of another taxpayer for a taxable year beginning in the calendar year in which the individual’s taxable year begins, and
(3)
an estate or trust.
(d)

Definitions and special rules
(1)

Dependent defined
For purposes of this section, the term dependent has the meaning given such term by section 152.
(2)

Identification number requirement
(A)

In general
In the case of a return other than a joint return, the energy price rebate amount in subsection (b)(1) shall be treated as being zero unless the taxpayer includes the valid identification number of the taxpayer on the return of tax for the taxable year.
(B)

Joint returns
In the case of a joint return, the energy price rebate amount in subsection (b)(1) shall be treated as being—
(i)
50 percent of the amount otherwise determined without regard to this paragraph if the valid identification number of only 1 spouse is included on the return of tax for the taxable year, and
(ii)
zero if the valid identification number of neither spouse is so included.
(C)

Valid identification number
For purposes of this paragraph, the term “valid identification number” means a social security number issued to an individual by the Social Security Administration on or before the due date for filing the return for the taxable year.
(D)

Special rule for members of the Armed Forces
Subparagraph (B) shall not apply in the case where at least 1 spouse was a member of the Armed Forces of the United States at any time during the taxable year and the valid identification number of at least 1 spouse is included on the return of tax for the taxable year.
(E)

Coordination with certain advance payments
In the case of any payment determined pursuant to subsection (f)(6), a valid identification number shall be treated for purposes of this paragraph as included on the taxpayer’s return of tax if such valid identification number is available to the Secretary as described in such subsection.
(F)

Mathematical or clerical error authority
Any omission of a correct valid identification number required under this paragraph shall be treated as a mathematical or clerical error for purposes of applying section 6213(g)(2) to such omission.
(3)

Credit treated as refundable
The credit allowed by subsection (a) shall be treated as allowed by subpart C of part IV of subchapter A of chapter 1.
(e)

Coordination with advance refunds of credit
(1)

Reduction of refundable credit
The amount of the credit which would (but for this paragraph) be allowable under subsection (a) for any taxable year shall be reduced (but not below zero) by the aggregate refunds and credits made or allowed to the taxpayer (or, except as otherwise provided by the Secretary, any dependent of the taxpayer) under subsection (f) for such taxable year. Any failure to so reduce the credit shall be treated as arising out of a mathematical or clerical error and assessed according to section 6213(b)(1).
(2)

Joint returns
Except as otherwise provided by the Secretary, in the case of a refund or credit made or allowed under subsection (f) with respect to a joint return, half of such refund or credit shall be treated as having been made or allowed to each individual filing such return.
(f)

Advance refunds and credits
(1)

In general
Subject to paragraphs (5) and (6), for any rebate taxable year, each individual who was an eligible individual for such individual’s first taxable year beginning in 2020 shall be treated as having made a payment against the tax imposed by chapter 1 for such applicable taxable year in an amount equal to advance refund amount for such rebate taxable year.
(2)

Advance refund amount
(A)

In general
For purposes of paragraph (1), the advance refund amount is the amount that would have been allowed as a credit under this section for such taxable year if this section (other than subsection (e) and this subsection) had applied to such taxable year.
(B)

Treatment of deceased individuals
For purposes of determining the advanced refund amount with respect to such taxable year—
(i)
any individual who was deceased before January 1, 2022 shall be treated for purposes of applying subsection (d)(2) in the same manner as if the valid identification number of such person was not included on the return of tax for the applicable taxable year (except that subparagraph (D) thereof shall not apply), and
(ii)
notwithstanding clause (i), in the case of a joint return with respect to which only 1 spouse is deceased before January 1, 2022, such deceased spouse was a member of the Armed Forces of the United States at any time during the applicable taxable year, and the valid identification number of such deceased spouse is included on the return of tax for the applicable taxable year, the valid identification number of 1 (and only 1) spouse shall be treated as included on the return of tax for the applicable taxable year for purposes of applying subsection (d)(2)(B) with respect to such joint return.
(3)

Timing and manner of payments
The Secretary shall, subject to the provisions of this title, refund or credit any overpayment attributable to this section and determined with respect to any month as rapidly as possible, consistent with a rapid effort to make payments attributable to such overpayments electronically if appropriate. No refund or credit shall be made or allowed under this subsection after December 31, 2022.
(4)

No interest
No interest shall be allowed on any overpayment attributable to this subsection.
(5)

Application to individuals who have filed a return of tax for 2021
(A)

Application to 2021 returns filed at time of initial determination
If, at the time of any determination made pursuant to paragraph (3), the individual referred to in paragraph (1) has filed a return of tax for the individual’s first taxable year beginning in 2021, paragraph (1) shall be applied with respect to such individual by substituting “2021” for “2020”.
(B)

Additional payment
(i)

In general
In the case of any individual who files, before the additional payment determination date, a return of tax for such individual’s first taxable year beginning in 2021, the Secretary shall make a payment (in addition to any payment made under paragraph (1)) to such individual equal to the excess (if any) of—
(I)
the amount which would be determined under paragraph (1) (after the application of subparagraph (A)) by applying paragraph (1) as of the additional payment determination date, over
(II)
the amount of any payment made with respect to such individual under paragraph (1).
(ii)

Additional payment determination date
The term “additional payment determination date” means the earlier of—
(I)
the date which is 90 days after the 2021 calendar year filing deadline, or
(II)
September 1, 2022.
(6)

Application to certain individuals who have not filed a return of tax for 2020 or 2021 at the time of determination
In the case of any individual who, at the time of any determination made pursuant to paragraph (3), has filed a tax return for neither the year described in paragraph (1) nor for the year described in paragraph (5)(A), the Secretary shall, consistent with rules similar to the rules of section 6428A(f)(5)(H)(i), apply paragraph (1) on the basis of information available to the Secretary and shall, on the basis of such information, determine the advance refund amount with respect to such individual without regard to subsection (d) unless the Secretary has reason to know that such amount would otherwise be reduced by reason of such subsection.
(7)

Special rule related to time of filing return
Solely for purposes of this subsection, a return of tax shall not be treated as filed until such return has been processed by the Internal Revenue Service.
(g)

Regulations
The Secretary shall prescribe such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section, including—
(1)
regulations or other guidance providing taxpayers the opportunity to provide the Secretary information sufficient to allow the Secretary to make payments to such taxpayers under subsection (f) (including the determination of the amount of such payment) if such information is not otherwise available to the Secretary, and
(2)
regulations or other guidance to ensure to the maximum extent administratively practicable that, in determining the amount of any credit under subsection (a) and any credit or refund under subsection (f), an individual is not taken into account more than once, including by different taxpayers and including by reason of a change in joint return status or dependent status between the taxable year for which an advance refund amount is determined and the taxable year for which a credit under subsection (a) is determined.
(h)

Outreach
The Secretary shall carry out a robust and comprehensive outreach program to ensure that all taxpayers described in subsection (g)(1) learn of their eligibility for the advance refunds and credits under subsection (f); are advised of the opportunity to receive such advance refunds and credits as provided under subsection (g)(1); and are provided assistance in applying for such advance refunds and credits.”.
(b)

Treatment of certain possessions
(1)

Payments to possessions with mirror code tax systems
The Secretary of the Treasury shall pay to each possession of the United States which has a mirror code tax system amounts equal to the loss (if any) to that possession by reason of the amendments made by this section. Such amounts shall be determined by the Secretary of the Treasury based on information provided by the government of the respective possession.
(2)

Payments to other possessions
The Secretary of the Treasury shall pay to each possession of the United States which does not have a mirror code tax system amounts estimated by the Secretary of the Treasury as being equal to the aggregate benefits (if any) that would have been provided to residents of such possession by reason of the amendments made by this section if a mirror code tax system had been in effect in such possession. The preceding sentence shall not apply unless the respective possession has a plan, which has been approved by the Secretary of the Treasury, under which such possession will promptly distribute such payments to its residents.
(3)

Inclusion of administrative expenses
The Secretary of the Treasury shall pay to each possession of the United States to which the Secretary makes a payment under paragraph (1) or (2) an amount equal to the increase (if any) of the administrative expenses of such possession—
(A)
in the case of a possession described in paragraph (1), by reason of the amendments made by this section, and
(B)
in the case of a possession described in paragraph (2), by reason of carrying out the plan described in such paragraph, or
The amount described in subparagraph (A) shall be determined by the Secretary of the Treasury based on information provided by the government of the respective possession.
(4)

Coordination with credit allowed against united states income taxes
No credit shall be allowed against United States income taxes under section 6433 of the Internal Revenue Code of 1986 (as added by this section), nor shall any credit or refund be made or allowed under subsection (f) of such section, to any person—
(A)
to whom a credit is allowed against taxes imposed by the possession by reason of the amendments made by this section, or
(B)
who is eligible for a payment under a plan described in paragraph (2).
(5)

Mirror code tax system
For purposes of this subsection, the term mirror code tax system means, with respect to any possession of the United States, the income tax system of such possession if the income tax liability of the residents of such possession under such system is determined by reference to the income tax laws of the United States as if such possession were the United States.
(6)

Treatment of payments
For purposes of section 1324 of title 31, United States Code, the payments under this subsection shall be treated in the same manner as a refund due from a credit provision referred to in subsection (b)(2) of such section.
(c)

Administrative provisions
(1)

Definition of deficiency
Section 6211(b)(4)(A) of the Internal Revenue Code of 1986 is amended by striking “6428A, 6428B” and inserting “6428A, 6428B, 6433,”.
(2)

Exception from reduction or offset
Any refund payable by reason of section 6433(f) of the Internal Revenue Code of 1986 (as added by this section), or any such refund payable by reason of subsection (b) of this section, shall not be—
(A)
subject to reduction or offset pursuant to subsection (c), (d), (e), or (f) of section 6402 of the Internal Revenue Code of 1986 or any similar authority permitting offset, or
(B)
reduced or offset by other assessed Federal taxes that would otherwise be subject to levy or collection.
(3)

Assignment of benefits
(A)

In general
The right of any person to any applicable payment shall not be transferable or assignable, at law or in equity, and no applicable payment shall be subject to, execution, levy, attachment, garnishment, or other legal process, or the operation of any bankruptcy or insolvency law.
(B)

Encoding of payments
In the case of an applicable payment described in subparagraph (E)(iii)(I) that is paid electronically by direct deposit through the Automated Clearing House (ACH) network, the Secretary of the Treasury (or the Secretary's delegate) shall—
(i)
issue the payment using a unique identifier that is reasonably sufficient to allow a financial institution to identify the payment as an applicable payment, and
(ii)
further encode the payment pursuant to the same specifications as required for a benefit payment defined in section 212.3 of title 31, Code of Federal Regulations.
(C)

Garnishment
(i)

Encoded payments
In the case of a garnishment order that applies to an account that has received an applicable payment that is encoded as provided in subparagraph (B), a financial institution shall follow the requirements and procedures set forth in part 212 of title 31, Code of Federal Regulations, except—
(I)
notwithstanding section 212.4 of title 31, Code of Federal Regulations (and except as provided in subclause (II)), a financial institution shall not fail to follow the procedures of sections 212.5 and 212.6 of such title with respect to a garnishment order merely because such order has attached, or includes, a notice of right to garnish federal benefits issued by a State child support enforcement agency, and
(II)
a financial institution shall not, with regard to any applicable payment, be required to provide the notice referenced in sections 212.6 and 212.7 of title 31, Code of Federal Regulations.
(ii)

Other payments
In the case of a garnishment order (other than an order that has been served by the United States) that has been received by a financial institution and that applies to an account into which an applicable payment that has not been encoded as provided in subparagraph (B) has been deposited electronically on any date during the lookback period or into which an applicable payment that has been deposited by check on any date in the lookback period, the financial institution, upon the request of the account holder, shall treat the amount of the funds in the account at the time of the request, up to the amount of the applicable payment (in addition to any amounts otherwise protected under part 212 of title 31, Code of Federal Regulations), as exempt from a garnishment order without requiring the consent of the party serving the garnishment order or the judgment creditor.
(iii)

Liability
A financial institution that acts in good faith in reliance on clauses (i) or (ii) shall not be subject to liability or regulatory action under any Federal or State law, regulation, court or other order, or regulatory interpretation for actions concerning any applicable payments.
(D)

No reclamation rights
This paragraph shall not alter the status of applicable payments as tax refunds or other nonbenefit payments for purpose of any reclamation rights of the Department of the Treasury or the Internal Revenue Service as per part 210 of title 31, Code of Federal Regulations.
(E)

Definitions
For purposes of this paragraph—
(i)

Account holder
The term account holder means a natural person whose name appears in a financial institution’s records as the direct or beneficial owner of an account.
(ii)

Account review
The term account review means the process of examining deposits in an account to determine if an applicable payment has been deposited into the account during the lookback period. The financial institution shall perform the account review following the procedures outlined in section 212.5 of title 31, Code of Federal Regulations and in accordance with the requirements of section 212.6 of title 31, Code of Federal Regulations.
(iii)

Applicable payment
The term applicable payment means—
(I)
any payment made to an individual under this section (other than any payment made pursuant to paragraph (5)),
(II)
any advance payment made by a possession of the United States with a mirror code tax system (as defined in section 24(h)) pursuant to an election under paragraph (5)(B) which corresponds to a payment described in subclause (I), and
(III)
any advance payment made by American Samoa pursuant to a program for making such payments which is described in paragraph (5)(C)(ii).
(iv)

Garnishment
The term garnishment means execution, levy, attachment, garnishment, or other legal process.
(v)

Garnishment order
The term garnishment order means a writ, order, notice, summons, judgment, levy, or similar written instruction issued by a court, a State or State agency, a municipality or municipal corporation, or a State child support enforcement agency, including a lien arising by operation of law for overdue child support or an order to freeze the assets in an account, to effect a garnishment against a debtor.
(vi)

Lookback period
The term lookback period means the two-month period that begins on the date preceding the date of account review and ends on the corresponding date of the month two months earlier, or on the last date of the month two months earlier if the corresponding date does not exist.
(4)

Conforming amendments
(A)
Paragraph (2) of section 1324(b) of title 31, United States Code, is amended by inserting “6433,” after “6431,”.
(B)
The table of sections for subchapter B of chapter 65 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item:
“Sec. 6433. Energy price rebates.”.