II
109th CONGRESS
1st Session
S. 1809
IN THE SENATE OF THE UNITED STATES
October 3, 2005
Mr. Schumer 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 impose a temporary windfall profit tax on crude oil and to use the proceeds of the tax collected to offset the cost of supplemental spending bills that are targeted to aid victims of Hurricanes Katrina and Rita, and for other purposes.
Short title
This Act may be cited as the
Recapture Excess Profits and Invest in
Relief (REPAIR) Act of 2005
.
Temporary windfall profits tax
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:
Temporary windfall profits on crude oil
Sec. 5896. Imposition of tax.
Sec. 5897. Windfall profit; etc.
Sec. 5898. Special rules and definitions.
Imposition of tax
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 windfall profit of such taxpayer for any taxable year beginning during 2005 or 2006.
Applicable taxpayer
For purposes of this chapter, the term applicable taxpayer means, with respect to operations in the United States—
any integrated oil company (as defined in section 291(b)(4)), and
any other producer or refiner of crude oil with gross receipts from the sale of such crude oil or refined oil products for the taxable year exceeding $100,000,000.
Windfall profit; etc
General rule
For purposes of this chapter, the term windfall profit means the excess of the adjusted taxable income of the applicable taxpayer for the taxable year over the reasonably inflated average profit for such taxable year.
Adjusted taxable income
For purposes of this chapter, with respect to any applicable taxpayer, the adjusted taxable income for any taxable year is equal to the taxable income for such taxable year (within the meaning of section 63 and determined without regard to this subsection)—
increased by any interest expense deduction, charitable contribution deduction, and any net operating loss deduction carried forward from any prior taxable year, and
reduced by any interest income, dividend income, and net operating losses to the extent such losses exceed taxable income for the taxable year.
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 2000–2004 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.
Special rules and definitions
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.
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.
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.
Crude oil
The term crude oil includes crude oil condensates and natural gasoline.
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.
Regulations
The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this chapter.
.
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. Temporary windfall profit on crude oil.
.
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:
The windfall profit tax imposed by section 5896.
.
Hurricane Relief Trust Fund
In general
Subchapter A of chapter 98 of the Internal Revenue Code of 1986 (relating to trust fund code) is amended by adding at the end the following new section:
Hurricane Relief Trust Fund
Establishment
There
is established in the Treasury of the United States a trust fund to be known as
the Hurricane Relief Trust Fund
, consisting of such amounts as
may be appropriated or credited to such Fund as provided in this section or
section 9602(b).
Transfers to Fund
There are hereby appropriated to the Hurricane Relief Trust Fund amounts equivalent to the taxes received in the Treasury under section 5896.
Expenditures
Amounts in the Hurricane Relief Trust Fund shall be available, without further appropriation, to offset the supplemental spending bills that are targeted to aid victims of Hurricanes Katrina and Rita enacted after the date of the enactment of this section and before January 1, 2008. Any funds that have not been expended by December 31, 2008, shall be credited back to the General Fund as regular tax receipts.
.
Clerical amendment
The table of sections for such subchapter is amended by adding at the end the following new item:
Sec. 9511. Hurricane Relief Trust Fund.
.
Effective dates
In general
Except as provided in paragraph (2), the amendments made by this section shall apply to taxable years beginning in 2005 and 2006.
Subsection (c)
The amendments made by subsection (d) shall take effect on the date of the enactment of this Act.