S. 2204 (112th): Repeal Big Oil Tax Subsidies Act

112th Congress, 2011–2013. Text as of Mar 20, 2012 (Placed on Calendar in the Senate).

Status & Summary | PDF | Source: GPO

II

Calendar No. 337

112th CONGRESS

2d Session

S. 2204

IN THE SENATE OF THE UNITED STATES

March 19, 2012

(for himself and Mr. Reid) introduced the following bill; which was read the first time

March 20, 2012

Read the second time and placed on the calendar

A BILL

To eliminate unnecessary tax subsidies and promote renewable energy and energy conservation.

1.

Short title

This Act may be cited as the Repeal Big Oil Tax Subsidies Act.

I

Tax extensions relating to energy

101.

Extension of credit for energy-efficient existing homes

(a)

In general

Paragraph (2) of section 25C(g) of the Internal Revenue Code of 1986 is amended by striking December 31, 2011 and inserting December 31, 2012.

(b)

Effective date

The amendment made by this section shall apply to property placed in service after December 31, 2011.

102.

Extension of credit for certain plug-in electric vehicles

(a)

In general

Subsection (f) of section 30 of the Internal Revenue Code of 1986 is amended by striking December 31, 2011 and inserting December 31, 2012.

(b)

Effective date

The amendment made by this section shall apply to vehicles acquired after December 31, 2011.

103.

Extension of credit for alternative fuel vehicle refueling property

(a)

Extension

Paragraph (2) of section 30C(g) of the Internal Revenue Code of 1986 is amended by striking December 31, 2011. and inserting December 31, 2012.

(b)

Effective date

The amendment made by this section shall apply to property placed in service after December 31, 2011.

104.

Extension of cellulosic biofuel producer credit

(a)

In general

Subparagraph (H) of section 40(b)(6) of the Internal Revenue Code of 1986 is amended to read as follows:

(H)

Application of paragraph

(i)

In general

This paragraph shall apply with respect to qualified cellulosic biofuel production after December 31, 2008, and before January 1, 2014.

(ii)

No carryover to certain years after expiration

If this paragraph ceases to apply for any period by reason of clause (i), rules similar to the rules of subsection (e)(2) shall apply.

.

(b)

Conforming amendment

(1)

In general

Paragraph (2) of section 40(e) of the Internal Revenue Code of 1986 is amended by striking or subsection (b)(6)(H).

(2)

Effective date

The amendment made by this subsection shall take effect as if included in section 15321(b) of the Heartland, Habitat, and Horticulture Act of 2008.

105.

Algae treated as a qualified feedstock for purposes of the cellulosic biofuel producer credit, etc

(a)

In general

Subclause (I) of section 40(b)(6)(E)(i) of the Internal Revenue Code of 1986 is amended to read as follows:

(I)

is derived by, or from, qualified feedstocks, and

.

(b)

Qualified feedstock; special rules for algae

Paragraph (6) of section 40(b) of the Internal Revenue Code of 1986 is amended by redesignating subparagraphs (F), (G), and (H), as amended by this Act, as subparagraphs (H), (I), and (J), respectively, and by inserting after subparagraph (E) the following new subparagraphs:

(F)

Qualified feedstock

For purposes of this paragraph, the term qualified feedstock means—

(i)

any lignocellulosic or hemicellulosic matter that is available on a renewable or recurring basis, and

(ii)

any cultivated algae, cyanobacteria, or lemna.

(G)

Special rules for algae

In the case of fuel which is derived by, or from, feedstock described in subparagraph (F)(ii) and which is sold by the taxpayer to another person for refining by such other person into a fuel which meets the requirements of subparagraph (E)(i)(II) and the refined fuel is not excluded under subparagraph (E)(iii)—

(i)

such sale shall be treated as described in subparagraph (C)(i),

(ii)

such fuel shall be treated as meeting the requirements of subparagraph (E)(i)(II) and as not being excluded under subparagraph (E)(iii) in the hands of such taxpayer, and

(iii)

except as provided in this subparagraph, such fuel (and any fuel derived from such fuel) shall not be taken into account under subparagraph (C) with respect to the taxpayer or any other person.

.

(c)

Algae treated as a qualified feedstock for purposes of bonus depreciation for biofuel plant property

(1)

In general

Subparagraph (A) of section 168(l)(2) of the Internal Revenue Code of 1986 is amended by striking solely to produce cellulosic biofuel and inserting solely to produce second generation biofuel (as defined in section 40(b)(6)(E)).

(2)

Conforming amendments

Subsection (l) of section 168 of such Code is amended—

(A)

by striking cellulosic biofuel each place it appears in the text thereof and inserting second generation biofuel,

(B)

by striking paragraph (3) and redesignating paragraphs (4) through (8) as paragraphs (3) through (7), respectively,

(C)

by striking Cellulosic in the heading of such subsection and inserting Second Generation, and

(D)

by striking cellulosic in the heading of paragraph (2) and inserting second generation.

(d)

Conforming amendments

(1)

Section 40 of the Internal Revenue Code of 1986, as amended by subsection (b), is amended—

(A)

by striking cellulosic biofuel each place it appears in the text thereof and inserting second generation biofuel,

(B)

by striking Cellulosic in the headings of subsections (b)(6), (b)(6)(E), and (d)(3)(D) and inserting Second generation, and

(C)

by striking cellulosic in the headings of subsections (b)(6)(C), (b)(6)(D), (b)(6)(H), (d)(6), and (e)(3) and inserting second generation.

(2)

Clause (ii) of section 40(b)(6)(E) of such Code is amended by striking Such term shall not and inserting The term second generation biofuel shall not.

(3)

Paragraph (1) of section 4101(a) of such Code is amended by striking cellulosic biofuel and inserting second generation biofuel.

(e)

Effective dates

(1)

In general

Except as provided in paragraph (2), the amendments made by this section shall apply to fuels sold or used after the date of the enactment of this Act.

(2)

Application to bonus depreciation

The amendments made by subsection (c) shall apply to property placed in service after the date of the enactment of this Act.

106.

Extension of incentives for biodiesel and renewable diesel

(a)

Credits for biodiesel and renewable diesel used as fuel

Subsection (g) of section 40A of the Internal Revenue Code of 1986 is amended by striking December 31, 2011 and inserting December 31, 2012.

(b)

Excise tax credits and outlay payments for biodiesel and renewable diesel fuel mixtures

(1)

Paragraph (6) of section 6426(c) of the Internal Revenue Code of 1986 is amended by striking December 31, 2011 and inserting December 31, 2012.

(2)

Subparagraph (B) of section 6427(e)(6) of such Code is amended by striking December 31, 2011 and inserting December 31, 2012.

(c)

Effective date

The amendments made by this section shall apply to fuel sold or used after December 31, 2011.

107.

Extension of production credit for refined coal

(a)

In general

Subparagraph (B) of section 45(d)(8) of the Internal Revenue Code of 1986 is amended by striking January 1, 2012 and inserting January 1, 2013.

(b)

Effective date

The amendment made by this section shall apply to facilities placed in service after December 31, 2011.

108.

Extension of production credit

(a)

In general

Section 45(d) of the Internal Revenue Code of 1986 is amended by striking January 1, 2014 each place it appears in paragraphs (2), (3), (4), (6), (7), (9), and (11) and inserting January 1, 2015.

(b)

Wind facilities

Paragraph (1) of section 45(d) of the Internal Revenue Code of 1986 is amended by striking January 1, 2013 and inserting January 1, 2014.

(c)

Increased credit amount for Indian coal facilities placed in service before 2009

Subparagraph (A) of section 45(e)(10) of the Internal Revenue Code of 1986 is amended by striking 7-year period each place it appears and inserting 8-year period.

(d)

Conforming amendments

Subsection (e) of section 1603 of division B of the American Recovery and Reinvestment Act of 2009 is amended—

(1)

by striking January 1, 2013 in paragraph (1) and inserting January 1, 2014, and

(2)

by striking January 1, 2014 in paragraph (2) and inserting January 1, 2015.

(e)

Effective dates

(1)

In general

Except as provided in paragraph (2), the amendments made by this section shall apply to facilities placed in service after December 31, 2012.

(2)

Indian coal

The amendment made by subsection (c) shall take effect on the date of the enactment of this Act.

109.

Extension of credit for energy-efficient new homes

(a)

In general

Subsection (g) of section 45L of the Internal Revenue Code of 1986 is amended by striking December 31, 2011 and inserting December 31, 2012.

(b)

Effective date

The amendment made by this section shall apply to homes acquired after December 31, 2011.

110.

Extension of credit for energy-efficient appliances

(a)

In general

Section 45M(b) of the Internal Revenue Code of 1986 is amended by striking 2011 each place it appears other than in the provisions specified in subsection (b), and inserting 2011 or 2012.

(b)

Provisions specified

The provisions of section 45M(b) of the Internal Revenue Code of 1986 specified in this subsection are subparagraph (C) of paragraph (1) and subparagraph (E) of paragraph (2).

(c)

Effective date

The amendments made by this section shall apply to appliances produced after December 31, 2011.

111.

Extension of election of investment tax credit in lieu of production credit

(a)

In general

Clause (ii) of section 48(a)(5)(C) of the Internal Revenue Code of 1986 is amended by striking or 2013 and inserting 2013, or 2014.

(b)

Wind facilities

Clause (i) of section 48(a)(5)(C) of the Internal Revenue Code of 1986 is amended by striking Any qualified facility and all that follows and inserting “Any facility which is—

(I)

a qualified facility (within the meaning of section 45) described in paragraph (1) of section 45(d) if such facility is placed in service in 2009, 2010, 2011, 2012, or 2013, or

(II)

a qualifying offshore wind facility, if such facility is placed in service in 2012, 2013, or 2014.

.

(c)

Qualifying offshore wind facility

Paragraph (5) of section 48(a) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:

(E)

Qualifying offshore wind facility

For purposes of this paragraph—

(i)

In general

The term qualifying offshore wind facility means an offshore facility using wind to produce electricity.

(ii)

Offshore facility

The term offshore facility means any facility located in the inland navigable waters of the United States, including the Great Lakes, or in the coastal waters of the United States, including the territorial seas of the United States, the exclusive economic zone of the United States, and the Outer Continental Shelf of the United States. For purposes of the preceding sentence, the term United States has the meaning given in section 638(1).

.

(d)

Effective date

The amendments made by this section shall apply to facilities placed in service after December 31, 2011.

112.

Expansion of qualifying advanced energy project credit

(a)

In general

Subparagraph (B) of section 48C(d)(1) of the Internal Revenue Code of 1986 is amended by striking $2,300,000,000 and inserting $4,600,000,000.

(b)

Effective date

The amendment made by this section shall take effect on the date of the enactment of this Act.

113.

Extension of special allowance for cellulosic biofuel plant property

(a)

In general

Subparagraph (D) of section 168(l)(2) of the Internal Revenue Code of 1986 is amended by striking January 1, 2013 and inserting January 1, 2014.

(b)

Conforming amendment

Paragraph (4) of section 168(l) of the Internal Revenue Code of 1986, as redesignated by this Act, is amended—

(1)

by striking and at the end of subparagraph (A),

(2)

by redesignating subparagraph (B) as subparagraph (C), and

(3)

by inserting after subparagraph (A) the following new subparagraph:

(B)

by substituting January 1, 2014 for January 1, 2013 in clause (i) thereof, and

.

114.

Extension of suspension of limitation on percentage depletion for oil and gas from marginal wells

(a)

In general

Clause (ii) of section 613A(c)(6)(H) of the Internal Revenue Code of 1986 is amended by striking January 1, 2012 and inserting January 1, 2013.

(b)

Effective date

The amendment made by this section shall apply to taxable years beginning after December 31, 2011.

115.

Extension of alternative fuels excise tax credits

(a)

In general

Sections 6426(d)(5), 6426(e)(3), and 6427(e)(6)(C) of the Internal Revenue Code of 1986 are each amended by striking December 31, 2011 and inserting December 31, 2012.

(b)

Effective date

The amendments made by this section shall apply to fuel sold or used after December 31, 2011.

116.

Extension of grants for specified energy property in lieu of tax credits

(a)

In general

Subsection (a) of section 1603 of division B of the American Recovery and Reinvestment Act of 2009, as amended by section 707 of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, is amended—

(1)

by striking or 2011 in paragraph (1) and inserting 2011, or 2012, and

(2)

in paragraph (2)—

(A)

by striking after 2011 and inserting after 2012, and

(B)

by striking or 2011 and inserting 2011, or 2012.

(b)

Conforming amendment

Subsection (j) of section 1603 of division B of such Act, as so amended, is amended by striking 2012 and inserting 2013.

(c)

Effective date

The amendments made by this section shall apply to property placed in service after December 31, 2011.

117.

Extension of mine rescue team training credit

(a)

In general

Subsection (e) of section 45N of the Internal Revenue Code of 1986 is amended by striking December 31, 2011 and inserting December 31, 2012.

(b)

Effective date

The amendment made by this section shall apply to taxable years beginning after December 31, 2011.

118.

Extension of election to expense mine safety equipment

(a)

In general

Subsection (g) of section 179E of the Internal Revenue Code of 1986 is amended by striking December 31, 2011 and inserting December 31, 2012.

(b)

Effective date

The amendment made by this section shall apply to property placed in service after December 31, 2011.

II

Repeal of oil and gas subsidies

A

Close big oil tax loopholes

201.

Modifications of foreign tax credit rules applicable to major integrated oil companies which are dual capacity taxpayers

(a)

In general

Section 901 of the Internal Revenue Code of 1986 is amended by redesignating subsection (n) as subsection (o) and by inserting after subsection (m) the following new subsection:

(n)

Special rules relating to major integrated oil companies which are dual capacity taxpayers

(1)

General rule

Notwithstanding any other provision of this chapter, any amount paid or accrued by a dual capacity taxpayer which is a major integrated oil company (as defined in section 167(h)(5)(B)) to a foreign country or possession of the United States for any period shall not be considered a tax—

(A)

if, for such period, the foreign country or possession does not impose a generally applicable income tax, or

(B)

to the extent such amount exceeds the amount (determined in accordance with regulations) which—

(i)

is paid by such dual capacity taxpayer pursuant to the generally applicable income tax imposed by the country or possession, or

(ii)

would be paid if the generally applicable income tax imposed by the country or possession were applicable to such dual capacity taxpayer.

Nothing in this paragraph shall be construed to imply the proper treatment of any such amount not in excess of the amount determined under subparagraph (B).
(2)

Dual capacity taxpayer

For purposes of this subsection, the term dual capacity taxpayer means, with respect to any foreign country or possession of the United States, a person who—

(A)

is subject to a levy of such country or possession, and

(B)

receives (or will receive) directly or indirectly a specific economic benefit (as determined in accordance with regulations) from such country or possession.

(3)

Generally applicable income tax

For purposes of this subsection—

(A)

In general

The term generally applicable income tax means an income tax (or a series of income taxes) which is generally imposed under the laws of a foreign country or possession on income derived from the conduct of a trade or business within such country or possession.

(B)

Exceptions

Such term shall not include a tax unless it has substantial application, by its terms and in practice, to—

(i)

persons who are not dual capacity taxpayers, and

(ii)

persons who are citizens or residents of the foreign country or possession.

.

(b)

Effective Date

(1)

In general

The amendments made by this section shall apply to taxes paid or accrued in taxable years beginning after the date of the enactment of this Act.

(2)

Contrary treaty obligations upheld

The amendments made by this section shall not apply to the extent contrary to any treaty obligation of the United States.

202.

Limitation on section 199 deduction attributable to oil, natural gas, or primary products thereof

(a)

Denial of deduction

Paragraph (4) of section 199(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:

(E)

Special rule for certain oil and gas income

In the case of any taxpayer who is a major integrated oil company (as defined in section 167(h)(5)(B)) for the taxable year, the term domestic production gross receipts shall not include gross receipts from the production, transportation, or distribution of oil, natural gas, or any primary product (within the meaning of subsection (d)(9)) thereof.

.

(b)

Effective date

The amendment made by this section shall apply to taxable years beginning after December 31, 2011.

203.

Limitation on deduction for intangible drilling and development costs

(a)

In general

Section 263(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new sentence: This subsection shall not apply to amounts paid or incurred by a taxpayer in any taxable year in which such taxpayer is a major integrated oil company (as defined in section 167(h)(5)(B))..

(b)

Effective date

The amendment made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2011.

204.

Limitation on percentage depletion allowance for oil and gas wells

(a)

In general

Section 613A of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

(f)

Application with respect to major integrated oil companies

In the case of any taxable year in which the taxpayer is a major integrated oil company (as defined in section 167(h)(5)(B)), the allowance for percentage depletion shall be zero.

.

(b)

Effective date

The amendment made by this section shall apply to taxable years beginning after December 31, 2011.

205.

Limitation on deduction for tertiary injectants

(a)

In general

Section 193 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

(d)

Application with respect to major integrated oil companies

This section shall not apply to amounts paid or incurred by a taxpayer in any taxable year in which such taxpayer is a major integrated oil company (as defined in section 167(h)(5)(B)).

.

(b)

Effective date

The amendment made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2011.

B

Outer Continental Shelf oil and natural gas

211.

Repeal of outer Continental Shelf deep water and deep gas royalty relief

(a)

In general

Sections 344 and 345 of the Energy Policy Act of 2005 (42 U.S.C. 15904, 15905) are repealed.

(b)

Administration

The Secretary of the Interior shall not be required to provide for royalty relief in the lease sale terms beginning with the first lease sale held on or after the date of enactment of this Act for which a final notice of sale has not been published.

III

Budgetary effects

301.

Deficit reduction

The net amount of any savings realized as a result of the enactment of this Act and the amendments made by this Act (after any expenditures authorized by this Act and the amendments made by this Act) shall be deposited in the Treasury and used for Federal budget deficit reduction or, if there is no Federal budget deficit, for reducing the Federal debt in such manner as the Secretary of the Treasury considers appropriate.

302.

Budgetary effects

The budgetary effects of this Act, for the purpose of complying with the Statutory Pay-As-You-Go Act of 2010, shall be determined by reference to the latest statement titled Budgetary Effects of PAYGO Legislation for this Act, submitted for printing in the Congressional Record by the Chairman of the Senate Budget Committee, provided that such statement has been submitted prior to the vote on passage.

March 20, 2012

Read the second time and placed on the calendar