May 13, 2025
Mr. Newhouse introduced the following bill; which was referred to the Committee on Ways and Means
To amend the Internal Revenue Code of 1986 to impose a tax on United States-bound circumvented cargo through Canada or Mexico and entering the United States.
Section 1. Cargo circumvention tax
(a) In general
Chapter 36 of subtitle D of the Internal Revenue Code of 1986 is amended by adding at the end the following new subchapter:
G Cargo circumvention tax
4499. Tax imposed
(a) In general
There is hereby imposed a tax on any United States-bound circumvented cargo entering the United States.
(b) Amount of tax
The amount of the tax imposed by subsection (a) shall be an amount equal to 0.125 percent of the value (determined under the customs laws of the United States) of the United States-bound circumvented cargo involved.
(c) Liability
The tax imposed by subsection (a) shall be paid by the importer of the cargo entering the United States.
(d) Time of imposition
The tax imposed by subsection (a) shall be imposed at the time of entry into the United States.
(e) United States-Bound circumvented cargo
For purposes of this section, the term
United States-bound circumvented cargomeans cargo which is discharged from an ocean-going vessel in Canada or Mexico and subsequently enters the United States by rail, highway, airport, or inland port, including intact intermodal cargo or cargo which is modified, assembled, or consolidated in Canada or Mexico.(f) Regulations
The Secretary shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section, including procedures for the collection of the tax imposed under subsection (a) and penalties for non-compliance.
(b) Clerical amendment
The table of subchapters for chapter 36 of subtitle D of such Code is amended by adding at the end the following new item:
(c) Effective date
The amendments made by this section shall apply to cargo entering the United States after December 31, 2025.