Big Oil Windfall Profits Tax Act
Sen. Whitehouse Introduces Big Oil Windfall Profits Tax Act to Send Rebates to Taxpayers
This bill is currently in the early stages of the legislative process. It was recently sent to the Senate Committee on Finance for review. There are no upcoming votes scheduled at this time, and the bill is not moving forward.
Passage Likelihood
Legislative Progress
Key Points
- This bill creates a 50% excise tax on windfall profits from crude oil, targeting large producers and importers who handle more than 300,000 barrels per day. The tax kicks in when oil prices exceed the 2025 annual average, with an inflation adjustment built in for future years.
From policy text
“The rate of tax imposed by this section on any barrel of taxable crude oil for any calendar quarter is the product of-- ``(A) 50 percent, and ``(B) the excess (if any) of-- ``(i) the average price of a barrel of Brent crude oil over the covered calendar quarter, over ``(ii) the average price of a barrel of Brent crude oil over the period beginning on January 1, 2025, and ending on December 31, 2025.”
View in full text - Revenue from the tax flows into a new trust fund called the Protect Consumers from Gas Hikes Fund, which is used exclusively to send rebate payments back to individual taxpayers each quarter.
From policy text
“There is hereby established in the Treasury of the United States a trust fund to be referred to as the `Protect Consumers from Gas Hikes Fund', consisting of such amounts as may be appropriated or credited to such trust fund as provided for in this section and section 9602(b).”
View in full text - Most Americans would qualify for quarterly rebates, but the payments phase out for higher earners: individuals above $75,000, heads of household above $112,500, and married couples above $150,000 see their rebates reduced by 5% of income above those thresholds.
From policy text
“The amount of the credit allowed by subsection (a) (determined without regard to this subsection and subsection (e)) shall be reduced (but not below zero) by 5 percent of so much of the eligible individual's adjusted gross income as exceeds-- ``(A) $150,000 in the case of a joint return, ``(B) $112,500 in the case of a head of household, and ``(C) $75,000 in any other case.”
View in full text - Joint filers receive 150% of the standard rebate amount. Military families get a special exception allowing the full joint rebate even if only one spouse has a Social Security number on file.
From policy text
“In the case of an eligible individual filing a joint return, the gasoline price rebate amount shall be 150 percent of the amount determined under paragraph (1) with respect to other taxpayers.”
View in full text - The tax applies to oil removed or imported after December 31, 2025, but companies get extra time to pay for the first two quarters of 2026, with those payments not due until September 30, 2026.
From policy text
“In the case of any calendar quarter ending before July 1, 2026, the tax imposed under section 5896 of the Internal Revenue Code of 1986 (as added by this section) shall not be due before September 30, 2026.”
View in full text
Impact Analysis
Personal Impact
Milestones
Read twice and referred to the Committee on Finance.
Sent to a congressional committee for expert review. The committee decides whether this bill moves forward.
Introduced in Senate
The bill was officially filed and given a number. It now enters the legislative queue.
Related News
3 articles
Big Oil profits surge as Democrats push windfall tax tied to Iran war
Lawmakers reintroduced the Big Oil Windfall Profits Tax Act to capture excess gains as crude prices exceed $100. The bill targets firms with 300,000+ barrels per day, using a 50% tax on price spikes above 2025 levels to fund quarterly checks for households earning under $150,000.
Shades of Windfall Profits Tax Again Stalk Energy Industry
Industry experts warn that the Big Oil Windfall Profits Tax Act could discourage domestic production. The proposal seeks to tax corporate revenues based on prices higher than the 2025 average, with sponsors estimating it could raise $35 billion to $40 billion annually for consumer rebates.
Dems Revive Legislation to Return Big Oil's Profits to Struggling US Families
The Big Oil Windfall Profits Tax Act aims to hold fossil fuel companies accountable for wartime profiteering. The per-barrel tax would equal 50% of the difference between current prices and the 2025 average, with revenue funding rebates for single filers under $75,000 and joint filers under $150,000.
Source Information
Document Type
Congressional Bill
Official Title
Big Oil Windfall Profits Tax Act
Data Sources
Sponsor
Cosponsors
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