In spite of a push by some lawmakers, the Democrats' $2 trillion climate and spending plan that passed the House on Nov. 19 does not include a virgin resin tax.
The Democrats' Build Back Better legislation now moves to the Senate, where the 20-cent-per-pound plastic tax has been championed by Sen. Sheldon Whitehouse, D-R.I., and had been part of an initial Senate list in September identifying potential funding sources for BBB.
It's not clear if the plastic tax, which industry groups have spent more than $1 million to oppose, ultimately has enough support to be included in the Senate version and reemerge in the debate.
But industry lobbyists say that even if it does not make its way into the BBB legislation now, they expect a resin tax proposal to return later, since Whitehouse and its House sponsor, Rep. Thomas Suozzi, D-N.Y., say it is a priority.
"It's an idea that Sen. Whitehouse and Rep. Suozzi have embraced and they have really made clear that this is going to be a priority for them going forward, regardless of if this gets into reconciliation [the BBB legislation] or not," said John Grant, director of government affairs at the Plastics Industry Association in Washington. "Nothing's dead until it's dead."
The BBB legislation, which includes universal pre-K, tax credits for clean energy and electric vehicle purchases, four weeks of paid parental leave and corporate tax hikes, narrowly passed the House, 220-213, and likely faces changes in the Senate.
Whitehouse's initial plastic fee proposal in August, the Rewarding Efforts to Decrease Unrecycled Contaminants in Ecosystems (REDUCE) Act, would put a 20-cent-per-pound tax on virgin resin in single-use applications, with exemptions and carveouts for medical, hygiene and similar products.
Environmental groups including Ocean Conservancy, Greenpeace, Surfrider Foundation and Oceana made the tax a priority, arguing in letters to Congress that a fee on virgin resin would counteract fossil fuel subsidies and the cost advantage that gives virgin plastic.
They and Whitehouse pointed to low recycling rates and said the tax could help incentivize recycling.
Industry groups have been suggesting for several weeks that it looked like including Whitehouse's plan in BBB was facing resistance in Congress. Suozzi had sought to put it in the legislation in the House.
Both the American Chemistry Council and the plastics association said in recent weeks they thought industry efforts had been blunting the tax's momentum.
As well, in a late October presentation to the Association of Plastic Recyclers, an outside lobbyist for the group, Yasmin Nelson, said the resin tax was not gathering broad enough support to gain traction.
"For right now, this is off the table," Nelson, a senior principal at the Bracewell Policy Resolution Group, told APR members.
But her colleague, Bracewell Partner Paul Nathanson, said it could come back.
"This is Washington, D.C. It might be out now. It could be in later. It doesn't go away," he said.
Plastics News reporter Jim Johnson contributed to this story.