H.R.480 - Methane Border Adjustment Mechanism Act (119th Congress)
Summary
H.R.480, the Methane Border Adjustment Mechanism Act, aims to amend the Internal Revenue Code of 1986 to establish a tax on imported goods based on their methane emissions during production. This "methane border adjustment mechanism" (MBAM) seeks to incentivize other countries to reduce methane emissions. The bill directs the Secretary of the Treasury to encourage other major oil and gas importing countries to implement similar mechanisms.
Expected Effects
The bill would impose a tax on importers of petroleum and natural gas based on the methane emissions associated with their production. This could lead to increased costs for consumers and businesses that rely on imported oil and gas. It may also incentivize foreign countries to reduce methane emissions in order to avoid the tax.
Potential Benefits
- Could lead to reduced global methane emissions, a potent greenhouse gas.
- May encourage cleaner production practices in other countries.
- Could strengthen the market for cleaner US gas exports.
- May improve public health by reducing ground-level ozone and particulate pollution.
- Could incentivize innovation in methane emissions reduction technologies.
Potential Disadvantages
- May increase costs for consumers and businesses that rely on imported oil and gas.
- Could face challenges in accurately measuring methane emissions in other countries.
- May lead to retaliatory tariffs from other countries.
- Could disproportionately impact developing countries that rely on oil and gas exports.
- May create administrative burdens for businesses and government agencies.
Most Disadvantaged Areas:
Constitutional Alignment
The bill appears to align with the Commerce Clause (Article I, Section 8), which grants Congress the power to regulate commerce with foreign nations. The establishment of taxes and tariffs falls under Congress's enumerated powers. The bill also references the Clean Air Act, indicating an attempt to legislate within existing environmental regulations. However, the potential for discriminatory effects on specific countries could raise concerns under the Equal Protection Clause, although this primarily applies to states, not foreign nations.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).