S. 1242 — Introduced in Senate

II 118th CONGRESS 1st Session S. 1242 IN THE SENATE OF THE UNITED STATES April 20, 2023Mr. Cotton (for himself, Mr. Rubio, Mr. Vance, and Mr. Hagerty) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To exclude critical minerals that were extracted or processed in certain countries that are providing insufficient levels of assistance to Ukraine from being included for purposes of determining the amount of the clean vehicle tax credit. 1. Short title This Act may be cited as the No EV Credits for Idle Allies Act. 2. Sense of Congress It is the sense of Congress that the United States does not have any free trade agreement in effect with the European Union or any member country of the European Union. 3. Exclusion of critical minerals extracted or processed in certain countries (a) Exclusion For purposes of determining the credit under section 30D of the Internal Revenue Code of 1986 with respect to any new clean vehicle (as defined in section 30D(d)(1) of such Code), any applicable critical minerals contained in the battery of such vehicle which were extracted or processed in Germany or France shall not be included for purposes of any determination under section 30D(e)(1)(A) of such Code with respect to such vehicle unless the Secretary of State certifies that the country has, since February 24, 2022, directly provided a cumulative amount of humanitarian, financial, and military aid to Ukraine which is not less than the cumulative amount of the United States direct commitment of humanitarian, financial, and military aid to Ukraine, as measured as a percent of GDP. (b) Recertification requirement (1) In general If the Secretary of State certifies that Germany or France satisfies the requirements under subsection (a), a review of such certification shall be made not less than annually thereafter for purposes of determining the inclusion or exclusion of applicable critical minerals extracted or processed in France or Germany in the credit calculation described in such subsection. (2) Failure to recertify With respect to the review described in paragraph (1), if the Secretary of State determines that France or Germany has failed to satisfy the requirements under subsection (a), the exclusion described in such subsection with respect to applicable critical minerals which were extracted or processed in such country shall apply for the 12-month period subsequent to such determination, at which time the Secretary of State shall reassess the levels of aid described in such subsection that have been provided. (c) Failure To attain certification for duration of war in Ukraine If the Secretary of State cannot make the certification described under subsection (a) with respect to France or Germany for the duration of the Russian war in Ukraine (as determined by the Secretary pursuant to subsection (d)), the exclusion described in subsection (a) with respect to applicable critical minerals which were extracted or processed in such country shall apply until such time as the government of that country— (1) spends not less than 2 percent of its GDP on defense spending; and (2) with respect to the 2 most recently completed calendar years, has maintained that level of funding. (d) Determination For purposes of subsection (c), the Secretary of State shall, upon determining that the Russian war in Ukraine has concluded, submit a notification to that effect to Congress. (e) Definitions In this section— (1) Aid to Ukraine The term aid to Ukraine shall only apply to assistance provided to the Government of Ukraine or for the assistance of individuals within the borders of Ukraine. (2) Applicable critical minerals The term applicable critical minerals has the same meaning given such term in section 45Z(c)(6) of the Internal Revenue Code of 1986. (3) Directly provided The term directly provided, with respect to aid, shall not include any contributions made to the European Union and subsequently provided to support Ukraine. (f) Effective date This section shall apply to vehicles placed in service after the date of enactment of this Act.