Section 1 Short title
This Act may be cited as the “Domestic Water Protection Act of 2022”.
Domestic Water Protection Act of 2022
A BILL
To amend the Internal Revenue Code of 1986 to impose an excise tax on water use during droughts, and for other purposes.
Sec. 2 Excise tax on growth of certain water-intensive crops
In general— Subchapter D of chapter 32 of the Internal Revenue Code of 1986 is amended by inserting after part I the following new part:
“II Water-intensive crops
“4171. Imposition of tax
“(a) In general—There is hereby imposed a tax on the sale of any specified water intensive crop by the manufacturer, producer, or importer thereof a tax of 300 percent of the price for which so sold.
“(b) Persons liable for tax—The manufacturer, producer, or importer referred to in subsection (a) shall be liable for the tax imposed by such subsection.
“(c) Regulations—The Secretary shall promulgate regulations for application of this section in a manner consistent with international trade agreements.
“4172. Definitions
“(a) Water-Intensive crop—For purposes of this part—
“(1) In general—The term “water-intensive crop” means a crop grown—
“(A) in an area experiencing prolonged drought at the time such crop is grown, and
“(B) by a manufacturer, producer, or importer which is a foreign corporation or foreign government.
“(b) Area experiencing prolonged drought—The term “area experiencing prolonged drought” means an area which has been identified by the United States Drought Monitor as experiencing severe, extreme, or exceptional drought lasting more than 6 months.
“4173. Special rules
“In the case of any water-intensive crop which is manufactured or produced by including one or more other water-intensive crops, no tax shall be imposed under this section on any water-intensive crop contained in the resulting specified water-intensive crop if tax was previously imposed under this section on such water-intensive crop when contained in the water-intensive crop so included.”
Conforming amendments—
Section 4221(a) is amended by adding at the end the following: “Paragraphs (1), (4), (5), and (6) shall not apply to the tax imposed under section 4171.”.
The table of parts for subchapter D of chapter 32 of such Code is amended by inserting after the item relating to part I the following new item:
Effective date— The amendments made by this section shall apply to sales after the date of the enactment of this Act.