Smith, Panetta, Reschenthaler Introduce Bipartisan Bill to Boost Critical Mineral Production

Washington, DC — Today Representatives Adrian Smith (R-NE), Jimmy Panetta (D-CA), and Guy Reschenthaler (R-PA) announced the introduction of the bipartisan Critical Minerals Investment Tax Modernization Act. The legislation would expand tax relief to support production of certain critical minerals important to national and economic security.  

"Embracing our nation's full capacity to produce critical minerals at home is essential to growing our economy, strengthening supply chains for key industries, and keeping our homeland secure," said Rep. Smith. "This bill will modernize existing tax deductions to boost domestic production and ensure the United States can meet the growing need for these valuable elements. I thank Reps. Panetta and Reschenthaler for working with me on this legislation." 

"Right now, our tax code doesn’t reflect the growing need for critical minerals that support our national security and clean energy future," said Rep. Panetta. "Our bipartisan Critical Minerals Investment Tax Modernization Act would update outdated IRS rules to prioritize all U.S.-designated critical minerals. This commonsense step will help boost domestic production, reduce our reliance on foreign adversaries, and strengthen our supply chains." 

"U.S dependence on China for critical minerals is unsustainable and a threat to our national security," said Rep. Reschenthaler. "Updating our critical minerals list is a necessary action to remove a bureaucratic hurdle and meet the growing needs of our nation, including for critical technologies. As the co-chairman of the Critical Materials Caucus, I am proud to introduce this bipartisan legislation with my colleagues and thank Rep. Adrian Smith for his leadership on this important issue." 

Currently, the tax code allows producers of critical minerals to recover a percentage of gross income known as a depletion allowance. At this time, the Internal Revenue Service (IRS) provides a 22 percent allowance for the highest-priority minerals, and a 14 percent allowance for certain other minerals. The Critical Minerals Investment Tax Modernization Act would amend the tax code to place rare earths and scandium in the 22 percent depletion category. 

Read the text of the bill here.

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