Congress Agrees to Extend Coal Excise to 2021

The U.S. Congress has acted to extend the coal excise tax that funds the Black Lung Disability Trust Fund for one year to the end 2021. The fund has been facing significant struggles due to bankruptcies throughout the coal industry.

At the end of 2019, congress took action to restore the coal excise tax to $1.10 per ton for underground mines and $0.50 per ton for surface miners for one year after the tax rate was briefly reduced. The tax was included in the fiscal year 2020 government spending bill. Coal companies have opposed continuing tax, citing the pandemic in its push to decrease the excise tax on coal, with the National Mining Association lobbying for a 55 percent reduction in the tax rate.

Without congressional action, the tax would have been cut in half, shifting the financial burden onto the government and further risking the fund of insolvency. The tax was extended in the latest federal government spending bill until the end of 2021. Which means advocates for continuing the current fund again have to worry about pushing congress to take action again unless they succeed in passing a longer-term solution this year.

The US Government of Accountability Office estimated in January 2020 that $865 million in black lung benefit responsibility has been transferred to the fund due to coal bankruptcies, with the fund currently in debt of around $4 billion to the US Treasury.

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