Democrats unveil polluter import tax legislation

Democrats unveil polluter import tax legislation

By Rachel Frazin

July 19th, 2021

As Democrats indicate that they want to tax polluter imports, two lawmakers are laying out a potential roadmap.

New legislation from Sen. Chris Coons (D-Del.) and Rep. Scott Peters (D-Calif.), would levy an import fee on goods including aluminum, cement, iron, steel, natural gas, petroleum and coal starting in 2024.

The Coons-Peters bill could be used by lawmakers as they hammer out the finer points of the $3.5 trillion Democratic-led infrastructure package in the Senate, but it’s not guaranteed that this is the form it will take.

Under their proposal, the list of products that the fee will be applied to would also expand as the U.S. determines the carbon intensity of producing various types of items.

The fee would be determined based both on the greenhouse gas emissions that occur during the item’s production and annual U.S. estimates of costs incurred by companies to comply with American environmental laws.

“We have an historic opportunity to demonstrate that climate policy goes hand in hand with providing economic opportunities as U.S. innovators develop and scale clean energy technologies,” Coons said in a statement.

He added that his proposal will “complement our efforts to reduce emissions at home, ensure the United States is at the table for reframing trade around climate, and provide resources to support vulnerable communities and energy innovation as we build back better.”

The proposal would exempt countries that are either considered to be among the least developed in the world, or those that both have environmental protections that are at least equally ambitious with U.S. regulations and that don’t impose a border carbon tax on the U.S.

The news that import fees would be included in the infrastructure package comes as the European Union is also proposing a carbon border tax.