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119-s-173119th CongressWALLET

Fueling Alternative Transportation with a Carbon Aviation Tax Act of 2025

Sponsored By: Senator Markey, Edward J. [D-MA]

Introduced

Summary

Raises fuel taxes on non-commercial aviation to fund air-quality monitoring and transit improvements in disadvantaged communities. This bill would sharply increase excise taxes on private and other non-commercial aircraft fuel, index part of the tax to inflation, and create a dedicated trust fund for local clean-air and transit projects.

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  • Private and other non-commercial operators would face a much higher excise: about 36¢ plus $1.6 per gallon, with the $1.6 portion indexed to inflation beginning after 2026. Commercial aviation would pay a low rate of 4.3¢ per gallon and a narrow helicopter/tree-care exemption is tightened.
  • Creates the "Funding to Support Clean Communities Trust Fund" paid from specified aviation and kerosene tax receipts to finance air monitoring, sensors in low-income and disadvantaged areas, and expansion or upgrades to public transit and passenger rail within 20 miles of airports. At least 50% of annual funding must go to disadvantaged communities.
  • Provides a refundable credit for fuel used with reasonable cause in non-commercial cases like scientific research, evacuations, or medical emergencies. Refunds go to the purchaser without interest and apply only to fuel sold or used before Jan 1, 2028.

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Bill Overview

Analyzed Economic Effects

3 provisions identified: 1 benefits, 2 costs, 0 mixed.

New Clean Communities Trust Fund

If enacted, a Clean Communities Trust Fund would start Jan 1, 2026. Money equal to the non-commercial aviation tax would be moved into the fund, subject to annual appropriations. The fund would pay for air pollution monitors, sensors, and transit or passenger rail projects near airports. At least 50% each year must be spent in disadvantaged communities.

Higher aviation fuel tax for private flights

If enacted, retail fuel for commercial flights would be taxed at 4.3¢ per gallon. Non-commercial aviation fuel would face $2.00 per gallon (35.9¢ + $1.641). The $1.641 part would be indexed for inflation for calendar years after 2026. Manufacturers' kerosene tax would follow the same rule. From Jan 1, 2026 until Jan 1, 2028 the Treasury could repay the extra non-commercial charge when the Secretary finds reasonable cause.

Narrower tax break for tree‑work flights

If enacted, aircraft used for planting, cutting, or caring for trees would only get the air-transport tax exemption if they do not use federally assisted airports or certain federal airport services. This change starts January 1, 2026. Small farmers and tree-service operators who use assisted airports or the listed services could lose the exemption and pay more tax.

Sponsors & CoSponsors

Sponsor

Markey, Edward J. [D-MA]

MA • D

Cosponsors

  • Sen. Murphy, Christopher [D-CT]

    CT • D

    Sponsored 1/21/2025

  • Sen. Merkley, Jeff [D-OR]

    OR • D

    Sponsored 1/21/2025

  • Sen. Sanders, Bernard [I-VT]

    VT • I

    Sponsored 1/21/2025

  • Sen. Warren, Elizabeth [D-MA]

    MA • D

    Sponsored 1/21/2025

  • Sen. Whitehouse, Sheldon [D-RI]

    RI • D

    Sponsored 1/21/2025

Roll Call Votes

No roll call votes available for this bill.

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