MARKET CHOICE Act

This bill would change how we fund infrastructure and cut pollution. It ends federal taxes on motor vehicle and aviation fuels and instead charges a fee on greenhouse gas pollution from fossil fuels and certain products. The fee starts at $40 per metric ton in 2027 and rises each year by 5% plus inflation; if emissions don’t fall as planned, it can rise an extra $4 per ton. It is charged where fuels are produced or imported, with refunds if carbon is captured and stored or if the fuel is used in ways that don’t release emissions. A similar fee applies to listed products such as ethanol, soda ash, nitrous oxide, biodiesel, and solid biomass. Companies can also get a credit if they already paid a similar state charge.

Most of the money goes into a new trust fund for infrastructure and climate solutions. From 2027 to 2036, 70% goes to the Highway Trust Fund. Other shares support home weatherization, help for displaced energy workers, grants to states, farm and forest conservation, and research on carbon removal, CO2 pipelines, and energy storage. The bill also funds grants to cities, states, and Tribes to reduce flooding, with up to 90% of project costs covered and priority for high‑risk and critical areas.

• Who is affected

  • Companies that produce or import fossil fuels, and makers/importers of the listed products subject to the pollution fee.
  • Importers and exporters in energy‑intensive industries, which face a border adjustment to keep U.S. goods competitive.
  • Workers in fossil energy and certain nuclear plants, who can receive retraining, relocation help, health benefits, and community support.
  • States, cities, and Tribes seeking flood‑protection funds; farmers and forest landowners through conservation programs.

• What changes

  • Federal motor vehicle and aviation fuel taxes are repealed; a pollution fee replaces them, with strong penalties for nonpayment.
  • A border adjustment charges imports and can rebate exporters; least‑developed countries and very small emitters can be exempt, and the President may pause it if not in the national interest.
  • While the fee is in place, EPA is limited in issuing some greenhouse gas rules for sources that pay the tax until 2039, but can still set standards for vehicles, non‑road equipment, and aircraft; those limits end early if emissions miss targets.
  • State climate laws are not overridden.

• When

  • Fee rate schedule begins in 2027; trust‑fund allocations run 2027–2036.
  • Border‑adjustment rules must be set within one year; it starts after those rules and after 2025.
  • Worker assistance runs for 10 years after enactment; a national climate commission sets goals and reports every five years starting in 2032.