Earlier this month, Senators Bill Cassidy (R-LA) and Lindsey Graham (R-SC) reintroduced the 2025 Foreign Pollution Fee Act, which would levy tiered and escalating tariffs on selected imported goods base on their carbon emissions and is aimed at boosting U.S. manufacturers’ competitiveness in low-carbon goods and raise tax revenue. In new research, Director of Energy and Environmental Policy Shuting Pomerleau estimates the costs of these tariffs and which countries’ exports would see the greatest impact.

An excerpt:

This research finds that the 2025 FPFA – considering its tax rate, tax base, behavioral responses, the effects of the tariffs on income and payroll tax revenue, and the current policy tariffs – would raise up to $133.6 billion in net revenue from 2026–2035 if the FPFA tariffs are stacked on current-policy tariffs, and 185.4 billion excluding current-policy tariffs.

Read the analysis.