Myths and facts about the PROVE IT Act

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Myth: Supporting the PROVE IT Act (S. 1863) does not mean support for carbon taxes.

Fact: Many bill supporters readily acknowledge that it will result in carbon taxes of some kind. Since 2021, about half of the sponsors of the PROVE IT Act have sponsored bills imposing carbon taxes on imports. Many of these sponsored bills also impose domestic carbon taxes.

Sen. Kevin Cramer (R-ND) has repeatedly argued for working with the European Union  on climate policy. He wrote: “We have an opportunity to counter Putin’s playbook with a bold initiative consistent with European priorities… One aspect of that initiative could be a joint trade mechanism between the United States and the European Union that levels a common carbon fee on imported goods.”

Once a carbon tax on imported goods is created, the US would inevitably impose a domestic carbon tax. This is due both to trade law obligations and because environmental groups and others would not stay silent as domestic industries fail to meet similar greenhouse gas reduction commitments. Also, most domestic manufacturers would oppose a domestic carbon tax absent a corresponding tax on imports to “level the playing field.” Enacting the corresponding tax on imports would therefore weaken industry opposition to a domestic carbon tax.

Finally, if legislators genuinely oppose carbon taxes, then why even take the risk of facilitating their enactment and implementation by building the administrative framework and lobbying base for such taxes?

The PROVE IT Act is not a carbon tax bill because it does not authorize a carbon tax.

Fact: This is a strawman argument. Opponents are not claiming that the bill authorizes a carbon tax. Instead, the bill creates the database whose information can and inevitably would be used for both a carbon tax on imports and a domestic carbon tax.

Myth: Legislators can support the PROVE IT Act and still defeat a carbon tax by opposing any bill that would authorize a carbon tax.

Fact: Congress has recently proven that such a belief is wrong. Just over a year ago in the Inflation Reduction Act (IRA), which was a partisan reconciliation bill, Congress used information collected under the EPA’s greenhouse gas reporting program to create a methane tax. The Senate passed the IRA on a 51-50 party-line vote with Vice President Kamala Harris casting the tiebreaker.

Many PROVE IT Act supporters have shown they would seek a replay of the methane tax maneuver. A narrow partisan majority would try and use the reconciliation process to force through a tax using the information collected under the PROVE IT Act. 

In the Senate Environment and Public Works Committee markup of the bill, all Committee Democrats voted to kill an amendment that would have helped block the future use of reconciliation to impose a carbon tax on imports and a domestic carbon tax based on PROVE IT Act information. Chairman Tom Carper (D-DE) opposed the amendment precisely because it “prohibits any revenue measure based on the greenhouse gas emissions associated with commodities or products.”


Myth: The PROVE IT Act would hold countries like China accountable for their greenhouse gas emissions.

Fact: As supporters simultaneously say the PROVE IT Act is about information, they also talk about holding countries accountable for their emissions. This accountability argument is a tacit admission that the bill will be used to impose carbon taxes on imports, at a minimum. After all, merely providing information cannot hold China, or any country, accountable.

The PROVE IT Act and the resulting taxes would be ineffective at holding China accountable for their greenhouse gas emissions because:

  • Obtaining accurate China data for this complex measuring scheme is unlikely. Also, China isn’t going to help the US to create this system.
  • American importers, not foreign competitors, directly pay import taxes to the US government. The burden of a carbon tax on imports would primarily be borne by American businesses and consumers. It acts as a domestic consumption tax.
  • According to the Niskanen Center, which supports carbon taxes, China’s exports to the United States account for only 4 percent of their total emissions.

For legislators who want to hold China accountable for their greenhouse gas emissions, it’s hard to imagine a more indirect and harmful way to do so than the PROVE IT Act. The bill would lead to new taxes on Americans, drive up prices, punish energy use, and legitimize extreme climate policies. Instead, a direct approach to address China’s emissions would require China to meet the same environmental requirements as the United States in United Nations environmental treaties. China, which is the world’s second largest economy and largest exporter, is still treated as a developing nation under these treaties. This special treatment should end.