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Tax Issue Page

Tax Issues In the Chemical Distribution Industry

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NACD supports a balanced tax system that does not impose undue burdens on the business community; one that protects the American economy and advances innovation.

For more information on specific tax policies, please explore the topics below and browse NACD’s resource database. For the latest actions in these areas, follow us on Twitter and visit our Newsroom.

Click here for more resources.

 

Superfund Tax

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In 1980, Congress passed the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), which established a program to protect public health and the environment by managing the cleanup of contaminated sites and by responding to nationally significant environmental emergencies. Through CERCLA, a federal trust fund or “Superfund” was created to finance the cleanup of uncontrolled or abandoned waste sites, accidents, spills, or other emergency releases of pollutants into the environment. CERCLA also gave the U.S. Environmental Protection Agency (EPA) the power to seek out parties that were deemed responsible for any release and assure their cooperation in paying their share of cleanup costs. EPA is reimbursed for its cleanup efforts through the Superfund when potential responsible parties cannot be identified or located. The Superfund was primarily financed through three taxes: a petroleum tax, chemical tax, and a corporate income tax. All three of these taxes expired in 1996.

On November 15, 2021, Congress resurrected the tax on 42 taxable chemicals through the Infrastructure Investment and Jobs Act (IIJA). In addition to resurrecting the tax, the IIJA: doubled the tax rates per ton on taxable chemicals, which will range from $0.48 per ton to $9.74 per ton; lowered the taxable substance threshold from 50% (by weight or value) to 20% (by weight or value); and increased the default tax rate from 5% to 10% for taxable substances. Title 26 of the U.S. Code contains an original list of 50 taxable substances. The IIJA also directed the Internal Revenue Service (IRS) to update the taxable substances list. The IRS issued a preliminary list of an additional 101 taxable substances.

NACD has prepared resources to help companies comply with the law. If you have any questions about the Superfund Tax for NACD, please submit them here.

 

Featured Resources

NACD Needs Your Support! Send a Letter to the IRS to Request Guidance on the Superfund Tax

To ensure the Internal Revenue Service (IRS) understands the compliance needs of chemical distributors as they navigate the newly reinstated Superfund Tax, NACD has prepared a template letter that members can fill out to send to the IRS.

  • Download this template letter to the IRS.
  • Place the letter on your company’s letterhead and add your company’s information. This template echoes the requests made by NACD and includes space for members to add their compliance questions.
  • Submit your letter to the docket HERE.

Click here for more resources.

If you are interested in accessing member-exclusive Superfund Tax document, please contact Jenni Jenkins, Director of Membership at jjenkins@nacd.com.

For further questions about NACD’s Taxes Issue Page, please contact Nicholas Breslin, Manager of Regulatory Affairs at nbreslin@nacd.com.