Increases the credit for qualified electric vehicles.
Provides that, for purposes of the general business credit, the alternative fuel retail sales credit of any taxpayer for any taxable year is 25 cents for each gasoline gallon equivalent of alternative fuel sold at retail by the taxpayer during such year as a fuel to propel any qualified motor vehicle.
Extends, for three years, the deduction for clean-fuel vehicles and certain refueling property.
[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 2591 Introduced in Senate (IS)]
106th CONGRESS
2d Session
S. 2591
To amend the Internal Revenue Code of 1986 to allow tax credits for
alternative fuel vehicles and retail sale of alternative fuels, and for
other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
May 18, 2000
Mr. Jeffords (for himself, Mr. Hatch, Mr. Rockefeller, Mr. Robb, Mr. L.
Chafee, Mr. Bryan, and Mr. Kerry) 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 allow tax credits for
alternative fuel vehicles and retail sale of alternative fuels, and for
other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Alternative Fuels Tax Incentives
Act''.
SEC. 2. FINDINGS.
Congress finds the following:
(1)(A) Since 1994, the United States has imported over half
its oil.
(B) Without efforts to mitigate this dependence on foreign
oil, the percentage of oil imported is expected to grow to all-
time highs.
(C) This reliance on foreign oil presents a national
security risk, which Congress should address through policy
changes designed to increase the use of domestically-available
alternative transportation fuels.
(2)(A) The importing of a majority of the oil used in the
United States contributes negatively to the balance of trade of
the United States.
(B) Assuring the Nation's economic security demands the
development and promotion of domestically-available alternative
transportation fuels.
(3) More widespread use of alternative-fuels vehicles will
help alleviate any adverse environmental consequences that may
result from the Nation's dependence on oil as a transportation
fuel.
(4) In order to encourage the purchase of alternative fuel
vehicles by individuals and businesses, the installation of
alternative fueling infrastructure by fuel suppliers, and the
use of alternative fuels in business and personal
transportation, tax credits are temporarily needed to make
buying and operating alternative fuels vehicles economically
viable compared with conventional fuel vehicles.
(5)(A) In the short-term, United States alternative fuel
policy must be made fuel neutral.
(B) Fuel neutrality will foster private innovation and
commercialization using the most technologically feasible and
economic fuels available.
(C) This will allow market forces to decide the alternative
fuel winners and losers.
SEC. 3. CREDIT FOR ALTERNATIVE FUEL VEHICLES.
(a) In General.--Subpart B of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 (relating to foreign tax credit,
etc.) is amended by inserting after section 30A the following:
``SEC. 30B. CREDIT FOR ALTERNATIVE FUEL VEHICLES.
``(a) Allowance of Credit.--There shall be allowed as a credit
against the tax imposed by this chapter an amount equal to the
applicable percentage of the incremental cost of any qualified
alternative fuel motor vehicle placed in service by the taxpayer during
the taxable year.
``(b) Applicable Percentage.--For purposes of subsection (a), the
applicable percentage with respect to any qualified alternative fuel
motor vehicle is--
``(1) 50 percent, plus
``(2) 35 percent, if such vehicle--
``(A) has a gross weight vehicle rating of less
than 14,000 pounds, and
``(i) has received a certificate of
conformity under the Clean Air Act and meets or
exceeds the most stringent standard available
for certification under the Clean Air Act for
that make and model year vehicle (other than a
zero emission standard), or
``(ii) has received an order certifying the
vehicle for sale in California and meets or
exceeds the most stringent standard available
for certification under the laws of the State
of California for that make and model year
vehicle (other than a zero emission standard),
or
``(B) has a gross weight vehicle rating of 14,000
or more pounds, and
``(i) has received a certificate of
conformity under the Clean Air Act at emissions
levels that are not more than 50 percent of the
standard applicable to a vehicle of that make
and model year, or
``(ii) has received an order certifying the
vehicle for sale in California at emissions
levels that are not more than 50 percent of the
standard applicable under the laws of the State
of California to a vehicle of that make and
model year.
``(c) Incremental Cost.--For purposes of this section, the
incremental cost of any qualified alternative fuel motor vehicle is
equal to the amount of the excess of the manufacturer's suggested
retail price for such vehicle over such price for a gasoline or diesel
fuel motor vehicle of the same model, to the extent such amount does
not exceed--
``(1) $5,000, if such vehicle has a gross vehicle weight
rating of not more than 8,500 pounds,
``(2) $10,000, if such vehicle has a gross vehicle weight
rating of more than 8,500 pounds but not more than 14,000
pounds,
``(3) $25,000, if such vehicle has a gross vehicle weight
rating of more than 14,000 pounds but not more than 26,000
pounds, and
``(4) $50,000, if such vehicle has a gross vehicle weight
rating of more than 26,000 pounds.
``(d) Qualified Alternative Fuel Motor Vehicle Defined.--For
purposes of this section, the term `qualified alternative fuel motor
vehicle' means any motor vehicle--
``(1) which is only capable of operating on an alternative
fuel,
``(2) the original use of which commences with the
taxpayer, and
``(3) which is acquired by the taxpayer for use or to
lease, but not for resale.
``(e) Application With Other Credits.--The credit allowed under
subsection (a) for any taxable year shall not exceed the excess (if
any) of--
``(1) the regular tax for the taxable year reduced by the
sum of the credits allowable under subpart A and sections 27,
29, and 30, over
``(2) the tentative minimum tax for the taxable year.
``(f) Other Definitions and Special Rules.--For purposes of this
section--
``(1) Alternative fuel.--The term `alternative fuel' means
compressed natural gas, liquefied natural gas, liquefied
petroleum gas, hydrogen, and any liquid at least 85 percent of
the volume of which consists of methanol.
``(2) Motor vehicle.--The term `motor vehicle' has the
meaning given such term by section 30(c)(2).
``(3) Reduction in basis.--For purposes of this subtitle,
the basis of any property for which a credit is allowable under
subsection (a) shall be reduced by the amount of such credit so
allowed (determined without regard to subsection (e).
``(4) No double benefit.--The amount of any deduction or
credit allowable under this chapter for any incremental cost
taken into account in computing the amount of the credit
determined under subsection (a) shall be reduced by the amount
of such credit attributable to such cost.
``(5) Leased vehicles.--No credit shall be allowed under
subsection (a) with respect to a leased motor vehicle unless
the lease documents clearly disclose to the lessee the specific
amount of any credit otherwise allowable to the lessor under
subsection (a).
``(6) Recapture.--The Secretary shall, by regulations,
provide for recapturing the benefit of any credit allowable
under subsection (a) with respect to any property which ceases
to be property eligible for such credit.
``(7) Property used outside united states, etc., not
qualified.--No credit shall be allowed under subsection (a)
with respect to any property referred to in section 50(b) or
with respect to the portion of the cost of any property taken
into account under section 179.
``(8) Election to not take credit.--No credit shall be
allowed under subsection (a) for any vehicle if the taxpayer
elects to not have this section apply to such vehicle.
``(g) Termination.--This section shall not apply to any property
placed in service after December 31, 2007.''.
(b) Conforming Amendments.--
(1) Section 1016(a) of the Internal Revenue Code of 1986 is
amended by striking ``and'' at the end of paragraph (26), by
striking the period at the end of paragraph (27) and inserting
``, and'', and by adding at the end the following:
``(28) to the extent provided in section 30B(f)(3).''.
(2) Section 53(d)(1)(B)(iii) of such Code is amended by
inserting ``, or not allowed under section 30B solely by reason
of the application of section 30B(e)(2)'' before the period.
(3) Section 55(c)(2) of such Code is amended by inserting
``30B(e),'' after ``30(b)(3)''.
(4) Section 6501(m) is amended by inserting ``30B(f)(8),''
after ``30(d)(4),''.
(5) The table of sections for subpart B of part IV of
subchapter A of chapter 1 of such Code is amended by inserting
after the item relating to section 30A the following:
``Sec. 30B. Credit for alternative fuel vehicles.''.
(e) Effective Date.--The amendments made by this section shall
apply to property placed in service after December 31, 2000, in taxable
years ending after such date.
SEC. 4. MODIFICATION OF CREDIT FOR QUALIFIED ELECTRIC VEHICLES.
(a) Amount of Credit.--
(1) In general.--Section 30(a) of the Internal Revenue Code
of 1986 (relating to allowance of credit) is amended by
striking ``10 percent of''.
(2) Limitation of credit according to type of vehicle.--
Section 30(b) of such Code (relating to limitations) is
amended--
(A) by striking paragraphs (1) and (2) and
inserting the following new paragraph:
``(1) Limitation according to type of vehicle.--The amount
of the credit allowed under subsection (a) for any vehicle
shall not exceed the greatest of the following amounts
applicable to such vehicle:
``(A) In the case of a vehicle with a rated top
speed not exceeding 50 miles per hour, the lesser of--
``(i) 10 percent of the cost of the
vehicle, or
``(ii) $4,250.
``(B) In the case of a vehicle with a gross vehicle
weight rating not exceeding 8,500 pounds and a rated
top speed exceeding 50 miles per hour, $4,250.
``(C) In the case of a vehicle capable of a driving
range of at least 100 miles on a single charge of the
vehicle's rechargeable batteries and measured pursuant
to the urban dynamometer schedules under appendix I to
part 86 of title 40, Code of Federal Regulations,
$6,375.
``(D) In the case of a vehicle capable of a payload
capacity of at least 1000 pounds, $6,375.
``(E) In the case of a vehicle with a gross vehicle
weight rating exceeding 8,500 but not exceeding 14,000
pounds, $8,500.
``(F) In the case of a vehicle with a gross vehicle
weight rating exceeding 14,000 but not exceeding 26,000
pounds, $21,250.
``(G) In the case of a vehicle with a gross vehicle
weight rating exceeding 26,000 pounds, $42,500.'', and
(B) by redesignating paragraph (3) as paragraph
(2).
(3) Conforming amendments.--
(A) Section 53(d)(1)(B)(iii) of such Code is
amended by striking ``section 30(b)(3)(B)'' and
inserting ``section 30(b)(2)(B)''.
(3) Section 55(c)(2) of such Code is amended by striking
``30(b)(3)'' and inserting ``30(b)(2)''.
(b) Qualified Electric Vehicle.--Section 30(c)(1)(A) of the
Internal Revenue Code of 1986 (defining qualified electric vehicle) is
amended to read as follows:
``(A) which is powered primarily by an electric
motor drawing current from rechargeable batteries, fuel
cells which generate electrical current from an
alternative fuel (as defined in section 30B(f)(1)), or
other portable sources of electrical current generated
on board the vehicle from an alternative fuel (as so
defined),''.
(c) Additional Special Rules.--Section 30(d) of the Internal
Revenue Code of 1986 (relating to special rules) is amended by adding
at the end the following new paragraphs:
``(5) No double benefit.--The amount of any deduction or
credit allowable under this chapter for any cost taken into
account in computing the amount of the credit determined under
subsection (a) shall be reduced by the amount of such credit
attributable to such cost.
``(6) Leased vehicles.--No credit shall be allowed under
subsection (a) with respect to a leased motor vehicle unless
the lease documents clearly disclose to the lessee the specific
amount of any credit otherwise allowable to the lessor under
subsection (a).''.
(d) Extension.--Section 30(e) of the Internal Revenue Code of 1986
(relating to termination) is amended by striking ``2004'' and inserting
``2007''.
(e) Effective Date.--The amendments made by this section shall
apply to property placed in service after December 31, 2000, in taxable
years ending after such date.
SEC. 5. CREDIT FOR RETAIL SALE OF ALTERNATIVE FUELS AS MOTOR VEHICLE
FUEL.
(a) In General.--Subpart D of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 (relating to business related
credits) is amended by inserting after section 40 the following:
``SEC. 40A. CREDIT FOR RETAIL SALE OF ALTERNATIVE FUELS AS MOTOR
VEHICLE FUEL.
``(a) General Rule.--For purposes of section 38, the alternative
fuel retail sales credit of any taxpayer for any taxable year is 25
cents for each gasoline gallon equivalent of alternative fuel sold at
retail by the taxpayer during such year as a fuel to propel any
qualified motor vehicle.
``(b) Definitions.--For purposes of this section--
``(1) Alternative fuel.--The term `alternative fuel' means
compressed natural gas, liquefied natural gas, liquefied
petroleum gas, hydrogen, and any liquid at least 85 percent of
the volume of which consists of methanol.
``(2) Gasoline gallon equivalent.--The term `gasoline
gallon equivalent' means, with respect to any alternative fuel,
the amount (determined by the Secretary) of such fuel having a
Btu content of 114,000.
``(3) Qualified motor vehicle.--The term `qualified motor
vehicle' means any motor vehicle (as defined in section
179A(e)(2)) which meets any applicable Federal or State
emissions standards with respect to each fuel by which such
vehicle is designed to be propelled.
``(4) Sold at retail.--
``(A) In general.--The term `sold at retail' means
the sale, for a purpose other than resale, after
manufacture, production, or importation.
``(B) Use treated as sale.--If any person uses
alternative fuel as a fuel to propel any qualified
motor vehicle (including any use after importation)
before such fuel is sold at retail, then such use shall
be treated in the same manner as if such fuel were sold
at retail as a fuel to propel such a vehicle by such
person.
``(c) No Double Benefit.--The amount of any deduction or credit
allowable under this chapter for any fuel taken into account in
computing the amount of the credit determined under subsection (a)
shall be reduced by the amount of such credit attributable to such
fuel.
``(d) Pass-Thru in the Case of Estates and Trusts.--Under
regulations prescribed by the Secretary, rules similar to the rules of
subsection (d) of section 52 shall apply.
``(e) Termination.--This section shall not apply to any fuel sold
at retail after December 31, 2007.''.
(b) Credit Treated as Business Credit.--Section 38(b) of the
Internal Revenue Code of 1986 (relating to current year business
credit) is amended by striking ``plus'' at the end of paragraph (11),
by striking the period at the end of paragraph (12) and inserting ``,
plus'', and by adding at the end the following:
``(13) the alternative fuel retail sales credit determined
under section 40A(a).''.
(c) Transitional Rule.--Section 39(d) of the Internal Revenue Code
of 1986 (relating to transitional rules) is amended by adding at the
end the following:
``(9) No carryback of section 40a credit before effective
date.--No portion of the unused business credit for any taxable
year which is attributable to the alternative fuel retail sales
credit determined under section 40A(a) may be carried back to a
taxable year ending before January 1, 2001.''.
(d) Clerical Amendment.--The table of sections for subpart D of
part IV of subchapter A of chapter 1 of the Internal Revenue Code of
1986 is amended by inserting after the item relating to section 40 the
following:
``Sec. 40A. Credit for retail sale of alternative fuels as
motor vehicle fuel.''.
(e) Effective Date.--The amendments made by this section shall
apply to fuel sold at retail after December 31, 2000, in taxable years
ending after such date.
SEC. 6. EXTENSION OF DEDUCTION FOR CERTAIN REFUELING PROPERTY.
(a) In General.--Section 179A(f) of the Internal Revenue Code of
1986 (relating to termination) is amended by striking ``2004'' and
inserting ``2007''.
(b) Conforming Amendment.--Section 179A(c) of the Internal Revenue
Code of 1986 (relating to qualified clean-fuel vehicle property
defined) is amended by striking paragraph (3).
(c) Effective Date.--The amendments made by this section shall
apply to property placed in service after December 31, 2000, in taxable
years ending after such date.
<all>
Introduced in Senate
Sponsor introductory remarks on measure. (CR S4199-4200)
Read twice and referred to the Committee on Finance.
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