PFAS Cleanup Act

Key Points

• This bill creates a new 45% excise tax on the sale of PFAS chemicals (often called 'forever chemicals') by manufacturers, producers, or importers. The tax applies to any man-made chemical with at least one fully fluorinated carbon atom that is made or brought into the United States.
• Public water systems can receive a 25% tax credit for money spent removing PFAS chemicals from drinking water, but only when the contamination exceeds safety limits set by the EPA. The credit is structured as part of the general business credit and includes an elective payment option so government-owned water systems can benefit too.
• Congress estimates that PFAS pollution causes up to $60 billion in annual health costs. Removing PFAS from drinking water can cost between $7 million and $30 million per pound of contamination, making cleanup extremely expensive for local communities.
• If a company manufactures or imports PFAS and uses the substance itself rather than selling it, the company still owes the tax based on the fair market value of the chemical. This closes a potential loophole where producers could avoid the tax by consuming their own product.
• Both the excise tax and the water remediation credit would take effect for tax years beginning after December 31, 2026, meaning they would first apply in the 2027 tax year.