Effective July 1, 2022, the Internal Revenue Service (IRS) Superfund chemical excise taxes will be reinstated with modified rates of tax and other provisions related to those taxes. The tax is authorized as part of the Infrastructure Investment and Jobs Act signed in November 2021 and set to expire on December 31, 2031.

The IRS tax applies to manufacturers, producers, and importers of certain chemical substances. For importers, the tax is imposed on any taxable substance sold or used.  Exports of taxable chemicals may be eligible for a credit.

Key changes include the lowering of the required percentage of taxable chemicals used to produce the substance from 50 percent to 20 percent of the weight (or the value) of the materials used to produce such substance.

Import tariff rates currently paid to U.S. Customs will remain the same.  Reporting requirements for this excise tax are made by the IRS.

Importers are advised to check with their tax advisor for financial impact and reporting requirements.

What is Superfund?

It’s a fund that allows the Environmental Protection Agency (EPA) to clean up sites contaminated by hazardous waste. Read More on Superfund. 

More information on the Superfund Tax can be found on the IRS website  Notice 2021-66.