Congress targets oil windfall profits to fund highways and transit.

What it does

This bill imposes a 50% excise fee on 'excess profits' earned by integrated oil companies, defined as profits above a baseline calculated from their average profits over 2021–2025 (plus 10% inflation adjustment). Revenue from the fee is directed to the Highway Trust Fund, Mass Transit Account, and Leaking Underground Storage Tank Trust Fund. Oil companies can deduct the fee as a business expense.

Why we flagged it

The bill's core mechanism is a targeted excise fee on excess profits of integrated oil companies, with revenue dedicated to public infrastructure and environmental funds. This is a straightforward sectoral tax, not a subsidy, carve-out, or deregulation.

What the text implies

• The 'reasonably inflated average profit' baseline uses a 5-year lookback (2021–2025) that captures the post-pandemic energy crisis; companies with structurally higher profits from that period will face higher baseline thresholds, potentially limiting the fee's bite on companies that have normalized to higher production costs.
• The fee is deductible under section 164(a)(5), reducing its effective rate and shifting some cost burden to other taxpayers through foregone revenue; the actual net tax on excess profits is lower than the stated 50% rate.
• Foreign corporations are subject to the fee only on U.S.-connected income, creating potential incentives for profit-shifting or restructuring to minimize U.S. taxable income.
• The bill does not include a sunset or review provision; the fee structure remains in place indefinitely unless repealed, creating long-term revenue certainty for infrastructure but also long-term compliance burden on affected companies.

Section numbers refer to the bill text the analysis read — linked under Primary records below.

Who it affects

The fee directly constrains oil company profits during price spikes, reducing their ability to capture windfall gains. Revenue flows to public infrastructure (highways, transit, environmental remediation), which benefits citizens broadly. The fee's structure targets only excess profits above a reasonable baseline, preserving normal business returns.

Named in the bill

Integrated oil companies (as defined in IRC section 291(b)(4)), Highway Trust Fund, Mass Transit Account, Leaking Underground Storage Tank Trust Fund, Internal Revenue Service, Secretary of the Treasury

Where it stands

• Sep 28, 2026 — Introduced · Congress.gov: “Introduced in Senate”
• Sep 28, 2026 — Referred to Senate Committee on Finance · Congress.gov: “Read twice and referred to the Committee on Finance”

Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.