H.R. 4714: End Polluter Welfare Act of 2025

The "End Polluter Welfare Act of 2025" is a legislative proposal focused on reducing financial support for fossil fuel industries and promoting sustainable energy practices. Here are the main components of the bill:

Elimination of Fossil Fuel Subsidies

The bill aims to end various subsidies currently provided to fossil fuel companies. This includes:

• Terminating tax expenditures that benefit fossil fuel production.
• Repealing royalty relief, which allows fossil fuel companies to pay reduced fees for extracting resources.
• Prohibiting federal funding for projects that support fossil fuels.

The intention is to redirect financial resources toward more sustainable energy initiatives.

Tax Treatment and Provisions

Several tax-related provisions are outlined in the bill:

• It addresses the treatment of dual capacity taxpayers, specifying how they will be taxed.
• Defines generally applicable income tax and outlines exceptions related to fossil fuels and renewable energy sources.
• Includes provisions for tax deductions applicable to oil spill liability and establishes specific taxes on crude oil.
• Modifications to renewable energy credits are also specified, with different effective dates for each provision.

Foreign Base Company Income

The bill provides a definition for "foreign base company oil related income" and includes specific taxation rules. Notably:

• Income from foreign companies producing less than 1,000 barrels of oil per day will be excluded from taxation.
• Requirements for reporting on carbon credits are established to promote transparency regarding carbon emissions.
• The bill reinforces the repeal of fossil fuel subsidies and includes adjustments to clean hydrogen production credits that take effect after the law is enacted.

Overall Goals

The overarching goals of the "End Polluter Welfare Act of 2025" are to reduce incentives for fossil fuel production and support a transition towards renewable energy sources, contributing to sustainability and potentially addressing climate change concerns.

Relevant Companies

• XOM (Exxon Mobil Corporation) - As a major player in the fossil fuel industry, the elimination of subsidies could significantly impact their profitability and operational funding.
• CVX (Chevron Corporation) - Similar to Exxon, Chevron could face financial challenges due to reduced federal support and increased taxation on fossil fuel activities.
• RDS.A (Royal Dutch Shell plc) - As a global oil company, the bill could affect Shell’s cost structure and investment strategies in fossil fuels.