II
119THCONGRESS
1
STSESSION S. 173
To amend the Internal Revenue Code of 1986 to increase excise taxes on
fuel used by private jets, and for other purposes.
IN THE SENATE OF THE UNITED STATES
JANUARY21, 2025
Mr. M
ARKEY(for himself, Mr. MURPHY, Mr. MERKLEY, Mr. SANDERS, Ms.
W
ARREN, and Mr. WHITEHOUSE) 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 increase
excise taxes on fuel used by private jets, and for other
purposes.
Be it enacted by the Senate and House of Representa-1
tives of the United States of America in Congress assembled, 2
SECTION 1. SHORT TITLE. 3
This Act may be cited as the ‘‘Fueling Alternative 4
Transportation with a Carbon Aviation Tax Act of 2025’’. 5
SEC. 2. INCREASE IN EXCISE TAX FOR FUEL USED BY PRI-6
VATE JETS. 7
(a) I
NGENERAL.— 8
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(1) RETAIL EXCISE TAX.—Section 4041(c) of 1
the Internal Revenue Code of 1986 is amended by 2
striking paragraph (3) and inserting the following: 3
‘‘(3) R
ATE OF TAX.—The rate of tax imposed 4
by this subsection shall be— 5
‘‘(A) with respect to any sale or use for 6
commercial aviation, 4.3 cents per gallon, and 7
‘‘(B) with respect to any sale or use which 8
is not described in subparagraph (A), an 9
amount equal to the sum of— 10
‘‘(i) 35.9 cents per gallon, plus 11
‘‘(ii) $1.641 per gallon. 12
‘‘(4) I
NFLATION ADJUSTMENT .—In the case of 13
any calendar year beginning after 2026, the dollar 14
amount in paragraph (3)(B)(ii) shall be increased by 15
an amount equal to— 16
‘‘(A) such dollar amount, multiplied by 17
‘‘(B) the cost-of-living adjustment deter-18
mined under section 1(f)(3) for the calendar 19
year, determined by substituting ‘calendar year 20
2025’ for ‘calendar year 2016’ in subparagraph 21
(A)(ii) thereof.’’. 22
(2) M
ANUFACTURERS EXCISE TAX .—Section 23
4081(a)(2) of such Code is amended— 24
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(A) in subparagraph (C), by striking 1
clause (ii) and inserting the following: 2
‘‘(ii) in the case of use for aviation 3
not described in clause (i), an amount 4
equal to the sum of— 5
‘‘(I) 35.9 cents per gallon, plus 6
‘‘(II) $1.641 per gallon.’’, and 7
(B) by adding at the end the following: 8
‘‘(E) I
NFLATION ADJUSTMENT .—In the 9
case of any calendar year beginning after 2026, 10
the dollar amount in subparagraph (C)(ii)(II) 11
shall be increased by an amount equal to— 12
‘‘(i) such dollar amount, multiplied by 13
‘‘(ii) the cost-of-living adjustment de-14
termined under section 1(f)(3) for the cal-15
endar year, determined by substituting 16
‘calendar year 2025’ for ‘calendar year 17
2016’ in subparagraph (A)(ii) thereof.’’. 18
(3) C
ONFORMING AMENDMENTS .— 19
(A) Section 4081(d)(2) of such Code is 20
amended by striking ‘‘(a)(2)(C)(ii)’’ and insert-21
ing ‘‘(a)(2)(C)(ii)(I)’’. 22
(B) Section 6427(l)(4)(B)(ii)(II) of such 23
Code is amended by striking ‘‘section 24
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4081(a)(2)(C)(ii)’’ and inserting ‘‘section 1
4081(a)(2)(C)(ii)(I)’’. 2
(C) Section 9503(c)(5)(B) of such Code is 3
amended by striking ‘‘21.8 cents’’ and inserting 4
‘‘35.9 cents’’. 5
(b) R
EFUND ORCREDIT INCASES OFREASONABLE 6
C
AUSE.—Section 6427 of the Internal Revenue Code of 7
1986 is amended by inserting after subsection (e) the fol-8
lowing new subsection: 9
‘‘(f) E
XCEPTIONFROMINCREASE INRATE OFTAX 10
FORCERTAINLIQUIDSUSED ASFUEL INNON-COMMER-11
CIALAVIATION.— 12
‘‘(1) R
ETAIL EXCISE TAX.—Except as provided 13
in subsection (k), in the case of any fuel on the sale 14
of which tax was imposed under section 4041(c) for 15
which the rate of tax was determined under para-16
graph (3)(B) of such section, if the Secretary deter-17
mines (pursuant to such regulations as are pre-18
scribed by the Secretary) that there is reasonable 19
cause that the increase in the rate of tax pursuant 20
to clause (ii) of such paragraph should not apply 21
with respect to such fuel (such as in cases where the 22
fuel was used in an aircraft which was engaged in 23
scientific research, an evacuation from a natural dis-24
aster, or assistance in a medical emergency), the 25
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Secretary shall pay (without interest) to the ultimate 1
purchaser of such fuel an amount equal to the in-2
crease in the amount of the tax imposed on such 3
fuel pursuant to such clause. 4
‘‘(2) M
ANUFACTURERS EXCISE TAX .—Except as 5
provided in subsection (k), in the case of any ker-6
osene on which tax was imposed under section 4081 7
for which the rate of tax was determined under sub-8
section (a)(2)(C)(ii) of such section, if the Secretary 9
determines (pursuant to such regulations as are pre-10
scribed by the Secretary) that there is reasonable 11
cause that the increase in the rate of tax pursuant 12
to subclause (II) of such subsection should not apply 13
with respect to such kerosene (such as in cases 14
where the kerosene was used in an aircraft which 15
was engaged in scientific research, an evacuation 16
from a natural disaster, or assistance in a medical 17
emergency), the Secretary shall pay (without inter-18
est) to the ultimate purchaser of such kerosene an 19
amount equal to the increase in the amount of the 20
tax imposed on such kerosene pursuant to such sub-21
clause. 22
‘‘(3) T
ERMINATION.—This subsection shall not 23
apply to any fuel sold or used after January 1, 24
2028.’’. 25
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(c) ELIMINATION OFEXEMPTIONFROMAIRTRANS-1
PORTATIONEXCISETAX.—Section 4261(f) of the Internal 2
Revenue Code of 1986 is amended to read as follows: 3
‘‘(f) E
XEMPTION FORCERTAINUSES.— 4
‘‘(1) I
N GENERAL.—No tax shall be imposed 5
under subsection (a) or (b) on air transportation by 6
helicopter or by fixed-wing aircraft for the purpose 7
of the planting, cultivation, cutting, or transpor-8
tation of, or caring for, trees. 9
‘‘(2) R
EQUIREMENT.—Paragraph (1) shall 10
apply only if the helicopter or fixed-wing aircraft 11
does not take off from, or land at, a facility eligible 12
for assistance under the Airport and Airway Devel-13
opment Act of 1970, or otherwise use services pro-14
vided pursuant to section 44509 or 44913(b) or sub-15
chapter I of chapter 471 of title 49, United States 16
Code, during such use.’’. 17
(d) E
FFECTIVEDATE.—The amendments made by 18
this section shall take effect on January 1, 2026. 19
SEC. 3. FUNDING TO SUPPORT CLEAN COMMUNITIES 20
TRUST FUND. 21
(a) I
NGENERAL.—Subchapter A of chapter 98 of the 22
Internal Revenue Code of 1986 is amended by adding at 23
the end the following new section: 24
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‘‘SEC. 9512. FUNDING TO SUPPORT CLEAN COMMUNITIES 1
TRUST FUND. 2
‘‘(a) E
STABLISHMENT AND FUNDING.—There is 3
hereby established in the Treasury of the United States 4
a trust fund to be referred to as the ‘Funding to Support 5
Clean Communities Trust Fund’, consisting of such 6
amounts as may be appropriated or credited to such trust 7
fund as provided for in this section and section 9602(b). 8
‘‘(b) T
RANSFERS TOTRUSTFUND.—There are here-9
by appropriated to the Funding to Support Clean Commu-10
nities Trust Fund amounts equivalent to the taxes re-11
ceived in the Treasury under— 12
‘‘(1) section 4041(c) to the extent attributable 13
to the rate specified in paragraph (3)(B)(ii) of such 14
section, and 15
‘‘(2) section 4081 with respect to kerosene to 16
the extent attributable to the rate specified in sec-17
tion 4081(a)(2)(C)(ii)(II). 18
‘‘(c) E
XPENDITURESFROMTRUSTFUND.— 19
‘‘(1) I
N GENERAL.—Subject to paragraph (2), 20
amounts in the Funding to Support Clean Commu-21
nities Trust Fund shall be available, as provided by 22
appropriation Acts, for making expenditures for 23
grants and other activities— 24
‘‘(A) authorized under subsections (a) 25
through (c) of section 103 and section 105 of 26
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the Clean Air Act (42 U.S.C. 7403(a)–(c), 1
7405), including grants and other activities 2
to— 3
‘‘(i) deploy, integrate, support, and 4
maintain fenceline air monitoring, screen-5
ing air monitoring, national air toxics 6
trend stations, and other air toxics and 7
community monitoring, 8
‘‘(ii) expand the national ambient air 9
quality monitoring network with new 10
multipollutant monitoring stations, 11
‘‘(iii) replace, repair, operate, and 12
maintain existing monitors, and 13
‘‘(iv) deploy, integrate, and operate 14
air quality sensors in low-income and dis-15
advantaged communities, 16
‘‘(B) to expand, connect, replace, repair, 17
operate, and maintain public transit and pas-18
senger rail infrastructure or systems that are 19
located 20 miles or less from an airport, and 20
‘‘(C) to improve public transportation, par-21
ticularly in disadvantaged communities, includ-22
ing costs associated with efforts to provide more 23
safe, frequent, and reliable bus service. 24
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‘‘(2) SET ASIDE FOR DISADVANTAGED COMMU -1
NITIES.— 2
‘‘(A) I
N GENERAL.—For any calendar 3
year, not less than 50 percent of the amounts 4
made available under paragraph (1) shall be 5
designated for expenditures for grants and 6
other activities within disadvantaged commu-7
nities. 8
‘‘(B) P
RIORITIZATION OF FUNDS FOR COM -9
MUNITIES DISPROPORTIONALLY IMPACTED BY 10
AIR POLLUTION.—With respect to making ex-11
penditures for grants and other activities de-12
scribed in paragraph (1) to disadvantaged com-13
munities, priority shall be given to communities 14
that are disproportionately impacted by air pol-15
lution (as determined by the Secretary in con-16
sultation with the Administrator of the Envi-17
ronmental Protection Agency). 18
‘‘(d) D
ISADVANTAGED COMMUNITY.—For purposes 19
of this section— 20
‘‘(1) I
N GENERAL.—The term ‘disadvantaged 21
community’ means a community with significant 22
representation of low-income communities or socially 23
disadvantaged groups (as defined in section 2501(a) 24
of the Food, Agriculture, Conservation, and Trade 25
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Act of 1990 (7 U.S.C. 2279(a))) that experiences or 1
is at risk of experiencing higher or more adverse 2
human health or environmental effects. 3
‘‘(2) L
OW-INCOME COMMUNITY .—For purposes 4
of paragraph (1), the term ‘low-income community’ 5
means any census block group in which 30 percent 6
or more of the population are individuals with an 7
annual household income equal to, or less than, the 8
greater of— 9
‘‘(A) an amount equal to 80 percent of the 10
median income of the area in which the house-11
hold is located, as reported by the Department 12
of Housing and Urban Development, and 13
‘‘(B) 200 percent of the Federal poverty 14
line.’’. 15
(b) C
ONFORMINGAMENDMENTS TO AIRPORT AND 16
A
IRWAYTRUSTFUND.—Section 9502(b)(1) of the Inter-17
nal Revenue Code of 1986 is amended— 18
(1) in subparagraph (A), by inserting ‘‘to the 19
extent attributable to the rates specified in subpara-20
graphs (A) and (B)(i) of section 4041(c)(3),’’ after 21
‘‘(relating to aviation fuels),’’, and 22
(2) in subparagraph (D), by striking ‘‘rate 23
specified in’’ and inserting ‘‘rates specified in clauses 24
(i) and (ii)(I) of’’. 25
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(c) CLERICALAMENDMENT.—The table of sections 1
for subchapter A of chapter 98 of the Internal Revenue 2
Code of 1986 is amended by adding at the end the fol-3
lowing new item: 4
‘‘Sec. 9512. Funding to Support Clean Communities Trust Fund.’’.
(d) EFFECTIVEDATE.—The amendments made by 5
this section shall take effect on January 1, 2026. 6
Æ
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