[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 2378 Introduced in Senate (IS)]

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118th CONGRESS
  1st Session
                                S. 2378

To amend the Internal Revenue Code of 1986 to increase excise taxes on 
           fuel used by private jets, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 19, 2023

Mr. Markey (for himself, Ms. Warren, and Mr. Whitehouse) 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 excise taxes on 
           fuel used by private jets, 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 ``Fueling Alternative Transportation 
with a Carbon Aviation Tax Act of 2023''.

SEC. 2. INCREASE IN EXCISE TAX FOR FUEL USED BY PRIVATE JETS.

    (a) In General.--
            (1) Retail excise tax.--Section 4041(c) of the Internal 
        Revenue Code of 1986 is amended by striking paragraph (3) and 
        inserting the following:
            ``(3) Rate of tax.--The rate of tax imposed by this 
        subsection shall be--
                    ``(A) with respect to any sale or use for 
                commercial aviation, 4.3 cents per gallon, and
                    ``(B) with respect to any sale or use which is not 
                described in subparagraph (A), an amount equal to the 
                sum of--
                            ``(i) 35.9 cents per gallon, plus
                            ``(ii) $1.589 per gallon.
            ``(4) Inflation adjustment.--In the case of any calendar 
        year beginning after 2024, the dollar amount in paragraph 
        (3)(B)(ii) shall be increased by an amount equal to--
                    ``(A) such dollar amount, multiplied by
                    ``(B) the cost-of-living adjustment determined 
                under section 1(f)(3) for the calendar year, determined 
                by substituting `calendar year 2023' for `calendar year 
                2016' in subparagraph (A)(ii) thereof.''.
            (2) Manufacturers excise tax.--Section 4081(a)(2) of such 
        Code is amended--
                    (A) in subparagraph (C), by striking clause (ii) 
                and inserting the following:
                            ``(ii) in the case of use for aviation not 
                        described in clause (i), an amount equal to the 
                        sum of--
                                    ``(I) 35.9 cents per gallon, plus
                                    ``(II) $1.589 per gallon.'', and
                    (B) by adding at the end the following:
                    ``(E) Inflation adjustment.--In the case of any 
                calendar year beginning after 2024, the dollar amount 
                in subparagraph (C)(ii)(II) shall be increased by an 
                amount equal to--
                            ``(i) such dollar amount, multiplied by
                            ``(ii) the cost-of-living adjustment 
                        determined under section 1(f)(3) for the 
                        calendar year, determined by substituting 
                        `calendar year 2023' for `calendar year 2016' 
                        in subparagraph (A)(ii) thereof.''.
            (3) Conforming amendments.--
                    (A) Section 4081(d)(2) of such Code is amended by 
                striking ``(a)(2)(C)(ii)'' and inserting 
                ``(a)(2)(C)(ii)(I)''.
                    (B) Section 6427(l)(4)(B)(ii)(II) of such Code is 
                amended by striking ``section 4081(a)(2)(C)(ii)'' and 
                inserting ``section 4081(a)(2)(C)(ii)(I)''.
                    (C) Section 9503(c)(5)(B) of such Code is amended 
                by striking ``21.8 cents'' and inserting ``35.9 
                cents''.
    (b) Refund or Credit in Cases of Reasonable Cause.--Section 6427 of 
the Internal Revenue Code of 1986 is amended by inserting after 
subsection (e) the following new subsection:
    ``(f) Exception From Increase in Rate of Tax for Certain Liquids 
Used as Fuel in Non-Commercial Aviation.--
            ``(1) Retail excise tax.--Except as provided in subsection 
        (k), in the case of any fuel on the sale of which tax was 
        imposed under section 4041(c) for which the rate of tax was 
        determined under paragraph (3)(B) of such section, if the 
        Secretary determines (pursuant to such regulations as are 
        prescribed by the Secretary) that there is reasonable cause 
        that the increase in the rate of tax pursuant to clause (ii) of 
        such paragraph should not apply with respect to such fuel (such 
        as in cases where the fuel was used in an aircraft which was 
        engaged in scientific research, an evacuation from a natural 
        disaster, or assistance in a medical emergency), the Secretary 
        shall pay (without interest) to the ultimate purchaser of such 
        fuel an amount equal to the increase in the amount of the tax 
        imposed on such fuel pursuant to such clause.
            ``(2) Manufacturers excise tax.--Except as provided in 
        subsection (k), in the case of any kerosene on which tax was 
        imposed under section 4081 for which the rate of tax was 
        determined under subsection (a)(2)(C)(ii) of such section, if 
        the Secretary determines (pursuant to such regulations as are 
        prescribed by the Secretary) that there is reasonable cause 
        that the increase in the rate of tax pursuant to subclause (II) 
        of such subsection should not apply with respect to such 
        kerosene (such as in cases where the kerosene was used in an 
        aircraft which was engaged in scientific research, an 
        evacuation from a natural disaster, or assistance in a medical 
        emergency), the Secretary shall pay (without interest) to the 
        ultimate purchaser of such kerosene an amount equal to the 
        increase in the amount of the tax imposed on such kerosene 
        pursuant to such subclause.
            ``(3) Termination.--This subsection shall not apply to any 
        fuel sold or used after January 1, 2026.''.
    (c) Elimination of Exemption From Air Transportation Excise Tax.--
Section 4261(f) of the Internal Revenue Code of 1986 is amended to read 
as follows:
    ``(f) Exemption for Certain Uses.--
            ``(1) In general.--No tax shall be imposed under subsection 
        (a) or (b) on air transportation by helicopter or by fixed-wing 
        aircraft for the purpose of the planting, cultivation, cutting, 
        or transportation of, or caring for, trees.
            ``(2) Requirement.--Paragraph (1) shall apply only if the 
        helicopter or fixed-wing aircraft does not take off from, or 
        land at, a facility eligible for assistance under the Airport 
        and Airway Development Act of 1970, or otherwise use services 
        provided pursuant to section 44509 or 44913(b) or subchapter I 
        of chapter 471 of title 49, United States Code, during such 
        use.''.
    (d) Effective Date.--The amendments made by this section shall take 
effect on January 1, 2024.

SEC. 3. FUNDING TO SUPPORT CLEAN COMMUNITIES TRUST FUND.

    (a) In General.--Subchapter A of chapter 98 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following new section:

``SEC. 9512. FUNDING TO SUPPORT CLEAN COMMUNITIES TRUST FUND.

    ``(a) Establishment and Funding.--There is hereby established in 
the Treasury of the United States a trust fund to be referred to as the 
`Funding to Support Clean Communities Trust Fund', consisting of such 
amounts as may be appropriated or credited to such trust fund as 
provided for in this section and section 9602(b).
    ``(b) Transfers to Trust Fund.--There are hereby appropriated to 
the Funding to Support Clean Communities Trust Fund amounts equivalent 
to the taxes received in the Treasury under--
            ``(1) section 4041(c) to the extent attributable to the 
        rate specified in paragraph (3)(B)(ii) of such section, and
            ``(2) section 4081 with respect to kerosene to the extent 
        attributable to the rate specified in section 
        4081(a)(2)(C)(ii)(II).
    ``(c) Expenditures From Trust Fund.--
            ``(1) In general.--Subject to paragraph (2), amounts in the 
        Funding to Support Clean Communities Trust Fund shall be 
        available, as provided by appropriation Acts, for making 
        expenditures for grants and other activities--
                    ``(A) authorized under subsections (a) through (c) 
                of section 103 and section 105 of the Clean Air Act (42 
                U.S.C. 7403(a)-(c), 7405), including grants and other 
                activities to--
                            ``(i) deploy, integrate, support, and 
                        maintain fenceline air monitoring, screening 
                        air monitoring, national air toxics trend 
                        stations, and other air toxics and community 
                        monitoring,
                            ``(ii) expand the national ambient air 
                        quality monitoring network with new 
                        multipollutant monitoring stations,
                            ``(iii) replace, repair, operate, and 
                        maintain existing monitors, and
                            ``(iv) deploy, integrate, and operate air 
                        quality sensors in low-income and disadvantaged 
                        communities,
                    ``(B) to expand, connect, replace, repair, operate, 
                and maintain public transit and passenger rail 
                infrastructure or systems that are located 20 miles or 
                less from an airport, and
                    ``(C) to improve public transportation, 
                particularly in underserved communities, including 
                costs associated with efforts to provide more safe, 
                frequent, and reliable bus service.
            ``(2) Set aside for environmental justice communities.--
                    ``(A) In general.--For any calendar year, not less 
                than 50 percent of the amounts made available under 
                paragraph (1) shall be designated for expenditures for 
                grants and other activities within environmental 
                justice communities.
                    ``(B) Prioritization of funds for communities 
                disproportionally impacted by air pollution.--With 
                respect to making expenditures for grants and other 
                activities described in paragraph (1) to environmental 
                justice communities, priority shall be given to 
                communities that are disproportionately impacted by air 
                pollution (as determined by the Secretary in 
                consultation with the Administrator of the 
                Environmental Protection Agency).
    ``(d) Environmental Justice Community.--For purposes of this 
section--
            ``(1) In general.--The term `environmental justice 
        community' means a community with significant representation of 
        communities of color, low-income communities, or Tribal and 
        Indigenous communities, that experiences, or is at risk of 
        experiencing higher or more adverse human health or 
        environmental effects.
            ``(2) Community of color.--For purposes of paragraph (1), 
        the term `community of color' means a geographically distinct 
        area in which the population of any of the following categories 
        of individuals is higher than the average population of that 
        category for the State in which the community is located:
                    ``(A) Black.
                    ``(B) African American.
                    ``(C) Asian.
                    ``(D) Pacific Islander.
                    ``(E) Other non-White race.
                    ``(F) Hispanic.
                    ``(G) Latino.
                    ``(H) Linguistically isolated.
                    ``(I) Middle Eastern and North African.
            ``(3) Tribal and indigenous community.--For purposes of 
        paragraph (1), the term `Tribal and Indigenous community' means 
        a population of people who are members of--
                    ``(A) a Federally recognized Indian Tribe,
                    ``(B) a State-recognized Indian Tribe,
                    ``(C) an Alaska Native community or organization,
                    ``(D) a Native Hawaiian community or organization, 
                or
                    ``(E) any other Indigenous community located in a 
                State.
            ``(4) Low-income community.--For purposes of paragraph (1), 
        the term `low-income community' means any census block group in 
        which 30 percent or more of the population are individuals with 
        an annual household income equal to, or less than, the greater 
        of--
                    ``(A) an amount equal to 80 percent of the median 
                income of the area in which the household is located, 
                as reported by the Department of Housing and Urban 
                Development, and
                    ``(B) 200 percent of the Federal poverty line.
            ``(5) Population.--For purposes of paragraphs (2), (3), and 
        (4), the term `population' means a census block group or series 
        of geographically contiguous blocks representing certain common 
        characteristics, such as race, ethnicity, national origin, 
        income-level, health disparities, or other public health and 
        socioeconomic attributes.''.
    (b) Conforming Amendments to Airport and Airway Trust Fund.--
Section 9502(b)(1) of the Internal Revenue Code of 1986 is amended--
            (1) in subparagraph (A), by inserting ``to the extent 
        attributable to the rates specified in subparagraphs (A) and 
        (B)(i) of section 4041(c)(3),'' after ``(relating to aviation 
        fuels),'', and
            (2) in subparagraph (D), by striking ``rate specified in'' 
        and inserting ``rates specified in clauses (i) and (ii)(I) 
        of''.
    (c) Clerical Amendment.--The table of sections for subchapter A of 
chapter 98 of the Internal Revenue Code of 1986 is amended by adding at 
the end the following new item:

``Sec. 9512. Funding to Support Clean Communities Trust Fund.''.
    (d) Effective Date.--The amendments made by this section shall take 
effect on January 1, 2024.
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