Cassidy Pitches Carbon Tax as IEEPA Replacement

Oct. 16, 2025
By: Pietro N. Bianchi

Senator Bill Cassidy (R-LA) continued trying to build support for carbon tariffs at the Louisiana Energy Security Summit, stating that then U.S. needs “a policy that spans presidential administrations.” Senator Cassidy reintroduced a carbon tariff bill, the “Foreign Pollution Fee Act,” in the Senate in April 8, 2025. Somehow this tariff news was not able to grab the tariff headlines at the time.

The foreign pollution fee proposed would be a tariff based on the manufacturing emission levels of the country of origin of an imported good. For years, Senator Cassidy has been promoting a foreign pollution fee as a way to make domestic U.S. manufacturing more competitive by taxing goods from other countries made with carbon intensive manufacturing. At the summit, Senator Cassidy hinted that his foreign pollution fee would provide economic and political stability, and room for regulation without changing the underlying law, alluding to the instability and potential illegality of President Trump’s IEEPA tariffs.

A day before Senator Cassidy’s remarks at the summit, the E.U. presented its new global climate and energy vision. One of the E.U. vision’s many goals is to simplify and strengthen the carbon border adjustment mechanism. The carbon border adjustment mechanism is the E.U.’s version of a carbon tariff. On average, the E.U. and U.S. have lower manufacturing emissions than other countries and therefore, their domestic manufacturing will be supported by carbon tariffs.

The E.U. has been taking steps toward implementing a carbon tariff that are eerily in step with Senator Cassidy. Like Cassidy’s statements hinting at the political and economic stability a carbon tariff has over IEEPA tariffs, the E.U. is promoting its carbon tariff as contributing to a rules-based international order. However, the similarity ends with stability. The rules-based order the E.U. is referring to is its commitment set out in the Paris Climate Accords, which the U.S. under President Trump withdrew from in 2025. Thus, the two policies may have broadly similar goals but very different paths to (potential) implementation.

We will provide any updates in the meantime and if you have questions about carbon taxes or other trade remedies do not hesitate to contact an attorney at Barnes Richardson, & Colburn LLP.