
June 3, 2024
Dear Representative,
Since a House companion to the PROVE IT Act (S.1863) may be introduced soon, the
undersigned organizations want to express our strong opposition to this pro-tax, anti-energy
legislation that will lead to both a carbon tax on imports and a domestic carbon tax.
The PROVE IT Act requires the Department of Energy to collect, analyze, and regularly update
data on the carbon intensity of domestic and foreign goods. Through the creation of this federal
administrative framework, Congress would be removing one of the biggest obstacles to the
imposition of carbon taxes on both imported and domestically produced goods.
It is clear that this information would then be used to impose new “climate” taxes, similar to
what Democrats in Congress did during the summer of 2022. In the Inflation Reduction Act
(IRA), which no Republicans supported in either the House or the Senate, Congress took
information collected under the EPA’s greenhouse gas reporting program and imposed the firstever federal methane tax. The Senate passed the IRA on a 51-50 party-line vote with Vice
President Kamala Harris casting the tiebreaker.
Many PROVE IT Act supporters have shown they seek a replay of the methane tax maneuver. In
the Senate Environment and Public Works Committee markup of the bill, all Committee
Democrats voted to kill an amendment that would have helped block the future use of
reconciliation to use PROVE IT Act information to impose carbon taxes on either imported or
domestically produced goods. Chairman Tom Carper (D-DE) opposed the amendment precisely
because it “prohibits any revenue measure based on the greenhouse gas emissions associated
with commodities or products.”
Many of the bill supporters expressly admit that the legislation would be used to develop carbon
taxes of some kind. Senator Chris Coons (D-DE), a lead sponsor and a past sponsor of domestic
carbon tax legislation has said the PROVE IT Act will inform the “process for imposing tariffs
on countries that don’t have any transparency around their emissions” as “part of any border
carbon adjustment mechanism.” The European Union (EU) has created the first and only carbon
border adjustment mechanism and it includes both a carbon tax on imports and a domestic
carbon pricing scheme.
Once a carbon tax on imported goods is created, the U.S. would inevitably impose a domestic
carbon tax. This is due both to trade law obligations and because environmental groups and
others would not stay silent as domestic industries fail to meet similar greenhouse gas reduction
commitments. Also, most domestic manufacturers would oppose a domestic carbon tax absent a
corresponding tax on imports to “level the playing field.” Enacting the corresponding tax on
imports would therefore weaken industry opposition to a domestic carbon tax.
The U.S. House recently passed a bipartisan resolution opposing and explaining the many
harmful effects of domestic carbon taxes (H.Con.Res.86). The PROVE IT Act would help to
make those harms a reality.
We find it very concerning that legislators would support a bill that would lead to:
Massive New Taxes. It’s not just a domestic carbon tax that would inflict financial pain
on Americans. The burden of a carbon tax on imports would primarily be borne by
American businesses and consumers. It acts as a domestic consumption tax.
Punishing Energy Use. Since more than 80 percent of the world’s energy comes from
coal, natural gas, and oil, which produce carbon dioxide emissions, carbon taxes are taxes
on the energy that make modern life possible. Put more simply, a carbon tax is a tax on
modern life.
Hurting the Poor. All Americans would suffer through higher prices due to these taxes.
This would always be harmful, but it’s especially harmful now as the United States
suffers through years of inflation. Higher prices due to carbon taxes, especially to meet
basic needs, would have a disproportionate impact on low-income households.
Embracing EU’s Extreme Climate Policy. Instead of fighting and rejecting the EU’s
disastrous climate policy, the PROVE IT Act embraces what the EU is doing. Many
supporters advocate for a carbon border adjustment mechanism and seek to create a
“carbon club” of countries that join together to impose carbon taxes in some fashion.
Americans want affordable and reliable energy, not federal tax schemes that treat energy use as a
sin. This bill though would lead to such taxes and is one of the biggest threats to energy and
economic prosperity in recent memory.
Therefore, we strongly urge legislators to oppose the PROVE IT Act and ensure that it is not
included, in any form, within other legislation.
Daren Bakst
Director, Center for Energy and Environment
Competitive Enterprise Institute
Lisa B. Nelson
Chief Executive Officer
ALEC Action
John Droz, Jr.
Founder
Alliance for Wise Energy Decisions (AWED)
Phil Kerpen
President
American Commitment
Kristen Walker
Policy Analyst
The American Consumer Institute
Thomas J. Pyle
President
American Energy Alliance
Hon. Jason Isaac
CEO
American Energy Institute
Margaret Byfield
Executive Director
American Stewards of Liberty
Richard Manning
President
Americans for Limited Government
Brent Gardner
Chief Government Affairs Officer
Americans for Prosperity
Grover Norquist
President
Americans for Tax Reform
David T. Stevenson
Director, Center for Energy & Environment
Caesar Rodney Institute
Ryan Ellis
President
Center for a Free Economy
Daniel Mitchell
President
Center for Freedom and Prosperity
Jeffrey Mazzella
President
Center for Individual Freedom
John Hinderaker
President
Center of the American Experiment
André Béliveau
Senior Manager of Energy Policy
Commonwealth Foundation
Matthew Kandrach
President
Consumer Action for a Strong Economy
E. Calvin Beisner, Ph.D.
President
Cornwall Alliance for the Stewardship of Creation
Jerry Simmons
President and CEO
Domestic Energy Producers Alliance
Kristen Ullman
President
Eagle Forum
Craig Richardson
President
Energy and Environment Legal Institute (E&E Legal)
George Landrith
President
Frontiers of Freedom
Cameron Sholty
Executive Director
Heartland Impact
James Taylor
President
The Heartland Institute
Ryan Walker
Executive Vice President
Heritage Action for America
Mario H. Lopez
President
Hispanic Leadership Fund
Gabriella Hoffman
Director, Center for Energy and Conservation
Independent Women’s Voice
Tom Harris
Executive Director
International Climate Science Coalition
Jon Sanders
Director of the Center for Food, Power, and Life
John Locke Foundation
Seton Motley
President
Less Government
Charles Sauer
President
Market Institute
Brandon Arnold
Executive Vice President
National Taxpayers Union
Daniel C. Turner
Executive Director
Power the Future
Donna Jackson
Director of Membership Development
Project 21
Paul Gessing
President
Rio Grande Foundation
Bette Grande
CEO and President
Roughrider Policy Center
James E. Enstrom
President
Scientific Integrity Institute
Karen Kerrigan
President
Small Business & Entrepreneurship Council
David Williams
President
Taxpayers Protection Alliance
Greg Sindelar
CEO
Texas Public Policy Foundation
Derrick Max
President and CEO
Thomas Jefferson Institute for Public Policy
Frank Lasee
President
Truth in Energy and Climate
Ben Zycher
Senior Fellow
*American Enterprise Institute
*Affiliation is for identification purposes only.