H.R. 7230: Buying American Cotton Act of 2026
The Buying American Cotton Act of 2026 is a legislative proposal aimed at promoting the consumption of domestically sourced cotton and products made from it. The key components of the bill are outlined below:
Domestic Cotton Consumption Credit
The bill establishes a tax credit called the "domestic cotton consumption credit." The purpose of this credit is twofold:
- To encourage consumers and businesses to purchase cotton that is grown in the United States and products made from such cotton.
- To create a documented tracing system to confirm the origins of the cotton through the supply chain.
How the Credit Works
The credit will be calculated based on three factors:
- The documented volume of qualified cotton in an eligible product sold during the taxable year.
- An applicable percentage established by the bill.
- The market price of cotton over a specified period.
Determining Eligibility
Qualifying Sales
A "qualifying sale" refers to the first sale of an eligible product to an unrelated person in the U.S. Sales made for consumption outside the U.S. do not qualify unless they relate to U.S. business activities.
Applicable Percentages
- If the cotton is processed within the U.S. or in a country with a U.S. free trade agreement, a percentage of 24% applies.
- If processed in a country without such an agreement, a lower percentage of 18% applies.
Definitions of Eligible Articles
An "eligible article" includes any product containing certified qualified cotton that is ready for retail sale to consumers. However, certain products may be excluded if they have components eligible for the credit.
Increased Credit for Specific Products
The bill provides additional credits for products made from qualified cotton yarn and fabric. The enhanced credit is 1.6 times for cotton yarn and 6.5 times for cotton fabric, incentivizing the production of these items within the U.S.
Reporting and Regulations
The Secretary of the Treasury will be responsible for creating regulations to enforce these provisions, including guidelines for tracing cotton through the supply chain and preventing the same cotton from being credited multiple times.
Effective Date
The provisions will take effect for sales of eligible products occurring after the law is enacted.
Impact on Taxation
The credits can be part of the general business credit, meaning businesses can apply these credits against their overall tax liabilities.
Relevant Companies
- HEB: This company engages in food and grocery retail and may benefit from increased demand for products made with American cotton.
- TGT: Target operates in the retail sector and may see changes in sourcing policies for products containing cotton.
- WMT: Walmart may adjust its supply chain to take advantage of the credits from products made with U.S. cotton.
This is an AI-generated summary of the bill text. There may be mistakes.
Sponsors
59 bill sponsors
-
TrackGregory F. Murphy
Sponsor
-
TrackAlma S. Adams
Co-Sponsor
-
TrackRick W. Allen
Co-Sponsor
-
TrackJoyce Beatty
Co-Sponsor
-
TrackSanford D. Bishop, Jr.
Co-Sponsor
-
TrackShontel M. Brown
Co-Sponsor
-
TrackSalud O. Carbajal
Co-Sponsor
-
TrackMike Carey
Co-Sponsor
-
TrackEarl L. "Buddy" Carter
Co-Sponsor
-
TrackSteve Cohen
Co-Sponsor
-
TrackMike Collins
Co-Sponsor
-
TrackJim Costa
Co-Sponsor
-
TrackEric A. "Rick" Crawford
Co-Sponsor
-
TrackHenry Cuellar
Co-Sponsor
-
TrackDonald G. Davis
Co-Sponsor
-
TrackJake Ellzey
Co-Sponsor
-
TrackAdriano Espaillat
Co-Sponsor
-
TrackMike Ezell
Co-Sponsor
-
TrackPat Fallon
Co-Sponsor
-
TrackShomari Figures
Co-Sponsor
-
TrackVince Fong
Co-Sponsor
-
TrackSylvia R. Garcia
Co-Sponsor
-
TrackVicente Gonzalez
Co-Sponsor
-
TrackPaul A. Gosar
Co-Sponsor
-
TrackJosh Gottheimer
Co-Sponsor
-
TrackAdam Gray
Co-Sponsor
-
TrackMichael Guest
Co-Sponsor
-
TrackJosh Harder
Co-Sponsor
-
TrackMark Harris
Co-Sponsor
-
TrackJ. French Hill
Co-Sponsor
-
TrackBrian Jack
Co-Sponsor
-
TrackRonny Jackson
Co-Sponsor
-
TrackSydney Kamlager-Dove
Co-Sponsor
-
TrackTrent Kelly
Co-Sponsor
-
TrackJennifer Kiggans
Co-Sponsor
-
TrackYoung Kim
Co-Sponsor
-
TrackDavid Kustoff
Co-Sponsor
-
TrackJulia Letlow
Co-Sponsor
-
TrackFrank D. Lucas
Co-Sponsor
-
TrackTracey Mann
Co-Sponsor
-
TrackMichael T. McCaul
Co-Sponsor
-
TrackBarry Moore
Co-Sponsor
-
TrackRalph Norman
Co-Sponsor
-
TrackJimmy Patronis
Co-Sponsor
-
TrackAugust Pfluger
Co-Sponsor
-
TrackChellie Pingree
Co-Sponsor
-
TrackJosh Riley
Co-Sponsor
-
TrackMike Rogers
Co-Sponsor
-
TrackDeborah K. Ross
Co-Sponsor
-
TrackDavid Rouzer
Co-Sponsor
-
TrackDavid Scott
Co-Sponsor
-
TrackAustin Scott
Co-Sponsor
-
TrackTerri A. Sewell
Co-Sponsor
-
TrackGreg Stanton
Co-Sponsor
-
TrackDale W. Strong
Co-Sponsor
-
TrackGlenn Thompson
Co-Sponsor
-
TrackWilliam R. Timmons IV
Co-Sponsor
-
TrackDavid G. Valadao
Co-Sponsor
-
TrackGabe Vasquez
Co-Sponsor
Actions
2 actions
| Date | Action |
|---|---|
| Jan. 22, 2026 | Introduced in House |
| Jan. 22, 2026 | Referred to the House Committee on Ways and Means. |
Corporate Lobbying
0 companies lobbying
None found.
* Note that there can be significant delays in lobbying disclosures, and our data may be incomplete.
