HR 8632
PFAS Cleanup Act
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Bill overview
The PFAS Cleanup Act proposes a new tax on the sale of perfluoroalkyl and polyfluoroalkyl substances (PFAS), which are chemicals linked to significant health and environmental concerns. It also establishes a tax credit for expenditures incurred to remove PFAS from public water systems. The goal is to generate revenue to address the substantial costs associated with PFAS pollution and incentivize remediation efforts.
Key provisions
- A 45% excise tax will be imposed on the sale of PFAS by manufacturers, producers, and importers.
- A 25% tax credit will be available to taxpayers for qualified PFAS water remediation expenditures.
- The credit applies to expenditures made by taxpayers to remove PFAS from public water systems that exceed established contaminant levels.
- The tax credit is considered part of the general business credit.
- The tax and credit will take effect on December 31, 2026.
- The Act clarifies definitions related to PFAS and the United States for tax purposes.
- Puerto Rico and the Virgin Islands are exempt from the PFAS excise tax.
- The Secretary will issue regulations to implement the tax and credit.
Who is affected
- Manufacturers of PFAS
- Producers of PFAS
- Importers of PFAS
- Public water systems
- Taxpayers
Notable changes
- Introduces a new federal excise tax on PFAS sales.
Sponsors
Official sponsors from legislative records.
Primary sponsor
Cosponsors
Eleanor Holmes [D-DC-At Large] Norton
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119th CONGRESS — 2d Session
H. R. 8632
IN THE HOUSE OF REPRESENTATIVES
A BILL
To amend the Internal Revenue Code of 1986 to impose an excise tax on the sale of perfluoroalkyl or polyfluoroalkyl substances, to establish a credit for expenditures paid or incurred for the removal of such substances from public water systems, and for other purposes.
This Act may be cited as the PFAS Cleanup Act
.
The Congress finds the following:
PFAS pollution results in significant health harms and social costs, including—
an estimated annual cost as high as $60,000,000,000 with respect to the impact of such pollution on health, and
an estimated cost of between $7,000,000 and $30,000,000 per pound of such pollution with respect to its removal from drinking water.
Raising revenues to partially address the significant costs resulting from PFAS pollution would complement other avenues for addressing such costs, including regulatory efforts by States and communities to hold PFAS polluters accountable.
Chapter 38 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subchapter:
The amount of tax imposed by subsection (a) shall be equal to 45 percent of the price for which the perfluoroalkyl or polyfluoroalkyl substance is sold.
For purposes of this subchapter—
with at least one fully fluorinated carbon atom, and
which is manufactured or produced in the United States or entered into the United States for consumption, use, or warehousing.
The term United States has the meaning given such term by section 4612(a)(4).
The term importer means the person entering the perfluoroalkyl or polyfluoroalkyl substance for consumption, use, or warehousing.
The provisions of subsections (a)(3) and (b)(3) of section 7652 shall not apply to any tax imposed by section 4691.
The table of subchapters for chapter 38 of such Code is amended by adding after the item relating to subchapter D the following new item:
The amendments made by this section shall apply with respect to taxable years beginning after December 31, 2026.
Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:
The term qualified PFAS water remediation expenditures means, with respect to any public water system owned or operated by the taxpayer, any expenditures paid or incurred by such taxpayer for the removal of any perfluoroalkyl or polyfluoroalkyl substance the presence of which within such public water system is hazardously excessive.
The term public water system has the meaning given such term by section 1401(4) of the Safe Drinking Water Act. Such term shall include any surface water system or ground water system.
Rules similar to the rules of paragraph (1) of section 41(f) shall apply for purposes of this section.
The Secretary, in consultation with the Administrator of the Environmental Protection Agency, shall prescribe such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section.
plusat the end of paragraph (40), by striking the period at the end of paragraph (41) and inserting
, plus, and by adding at the end the following new paragraph:
Section 6417(b) of such Code is amended by redesignating paragraphs (10) through (12) as paragraphs (11) through (13), respectively, and by inserting after paragraph (9) the following new paragraph:
The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by adding after the item relating to section 45AA the following new item: