Rep. Francis Rooney (R-Fla.), who in the past has backed carbon tax bills backed by Democrats, plans to introduce his own legislation July 25 that would use the revenue from a carbon tax to cut U.S. workers’ payroll taxes.
Rooney’s focus on payroll tax cuts would differ from other carbon tax bills proposed in Congress, including a measure (H.R. 6463 in the 115th Congress) he backed last year by former Rep. Carlos Curbelo (R-Fla.) to steer carbon tax revenue to fix U.S. roads, bridges, and other infrastructure. Curbelo was defeated in the November election.
“The broad strokes” of Rooney’s go-it-alone bill “are using a carbon tax to pay down payroll taxes,” Corey Schrodt, Rooney’s legislative director, said at a July 23 carbon tax forum held by the Alliance for Market Solutions, a group soliciting GOP support for a carbon tax.
“Cut carbon and not wages is what we are looking at,” Schrodt said.
Rooney’s bill would set a $30 per metric ton carbon tax on fossil fuel producers and large industrial emitters.
Research, Energy Costs
In addition to a nearly 1% payroll tax cut, the carbon tax revenue also would fund clean energy research and development and shield low-income households from increased energy costs.
A carbon tax in general could raise $1 trillion or more over 10 years, according to Congressional Budget Office estimates. But carbon tax legislation is dead on arrival in the Republican-controlled Senate. Still, advocates hope to lay the groundwork should Democrats take Senate control in 2020.
Other carbon tax measures expected soon include one by Rep. John Larson (D-Conn.). Larson plans to reintroduce carbon tax legislation July 26.
His 2017 bill, the America Wins Act (H.R. 4209) set an initial carbon price of $49 per ton.
The leading Democratic House bill (H.R. 763) on the topic so far was introduced in January by Rep. Ted Deutch (D-Fla.). The bill has 58 cosponsors, all Democrats except for Rooney.
The Deutch measure, the Energy Innovation and Carbon Dividend Act, would impose an initial $15 per ton fee on the carbon content of fuels including crude oil, natural gas, and coal, with that tax increasing at a rate of $10 per ton per year.
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