New Bill Could Set Stage For Carbon Tax In The United States

Last week, U.S. Sens. Chris Coons (D-Del.) and Kevin Cramer (R-N.D.) introduced a bipartisan bill that could set the foundation for a carbon border tax in the United States. The goal of the tax would be to impose fees on iron, steel, and other imports from competing countries, like China, that are not significantly reducing greenhouse gas emissions.

Specifically, the Providing Reliable, Objective, Verifiable Emissions Intensity and Transparency (PROVE IT) Act would direct the Department of Energy (DOE) to publish a study that identifies:

• Average emissions intensity of covered products produced in the United States, along with any gaps in intensity data;
• Average emissions intensity of covered products by a G7 country, free trade agreement partner, foreign country of concern, and countries that control substantive global market share of a covered product;
• Issues with verifying average product emissions intensity data for covered products produced in covered countries; and
• Relative emissions intensity of each category of covered products produced in the United States compared to the average product emissions intensity of each category of covered products produced in covered countries.

Organizations that have signed on to support the bill include the Independent Petroleum Association of America, the U.S. Chamber of Commerce, the American Iron and Steel Institute, the National Association of Manufacturers, and the Bipartisan Policy Center.

As Connecting the Dots readers are aware, the European Union has approved a carbon tax that will go into effect by 2026 and that is opposed by many members of U.S. industry since it would adversely affect U.S. producers.

Read more about the PROVE IT Act here. Read more about how the PROVE IT Act could lead to a carbon tax here.