The Proposed Foreign Pollution Fee Act

The recent amendment to the U.S. Internal Revenue Code, the Foreign Pollution Fee Act, proposes charges on carbon-intensive imports. This analysis delves into the bill's details, expressing concerns about its complexity, excessive discretionary power, and a perceived emphasis on geopolitics over global climate protection.

By Aaron Cosbey on December 1, 2023
  • Aaron Cosbey analyzes the proposed #ForeignPollution Fee Act, emphasizing its challenges in administration, the excessive discretionary powers, and its focus on geopolitical interests over global climate protection.

  • U.S. legislators aim to align #TradePolicy with climate goals through the Foreign Pollution Fee Act. However, @AaronCosbey's analysis highlights complexities, excessive discretion, and geopolitical priorities that could hinder its effectiveness in addressing global #climatechange.

  • With a focus on protecting U.S. producers, does the Foreign Pollution Fee Act truly prevent carbon leakage, or could it inadvertently hinder global efforts to mitigate climate change? @AaronCosbey unpacks the key elements of the Act.

In the realm of U.S. legislative initiatives addressing climate change and trade policy, Senators Bill Cassidy (R-La.), Lindsey Graham (R-S.C.), and Roger Wicker (R-Miss.) have introduced the Foreign Pollution Fee Act. This legislative proposal aims to levy charges on imports with higher carbon intensity than their U.S. counterparts. The bill has garnered attention for its potential to succeed where other border carbon adjustment proposals have faltered. However, this analysis reveals complex administrative challenges, broad discretionary powers, and a focus on geopolitical positioning and protecting domestic industries over global climate mitigation.

Participating experts

Commentary details

Focus area
IISD, 2023