CPA Supports Brown, Cassidy, Ossoff, Scott Bill to Prohibit Chinese Companies from Receiving IRA Tax Credits

WASHINGTON — The Coalition for a Prosperous America (CPA) today welcomed bipartisan legislation introduced by Senators Sherrod Brown (D-OH), Bill Cassidy (R-LA), Jon Ossoff (D-GA), and Rick Scott (R-FL) that would prohibit Chinese companies from receiving tax credits in the Inflation Reduction Act (IRA). Specifically, the bipartisan legislation would prevent any company with ties to a Foreign Entity of Concern from receiving the 45X Advanced Manufacturing Tax Credit. These restrictions are based on the same Foreign Entity of Concern rules that became law, on a bipartisan basis, as part of the Bipartisan Infrastructure Law in 2021.

CPA has long-called for excluding China from benefiting from IRA tax credits. As reported by The New York Times, a CPA economic analysis found “that Chinese manufacturers could earn up to $125 billion in tax credits under the law.” In December, CPA applauded U.S. Senator Marco Rubio (R-FL) and U.S. Representative Carol Miller (WV) for introducing legislation to prohibit Chinese companies from receiving IRA 45X tax credits. 

Chinese-owned companies’ global market share in solar products is more than 80 percent. The current environment, if left unaddressed, threatens America’s ambitions of building a domestic solar manufacturing supply chain and mitigating the risk of an overreliance on Chinese solar. An analysis by the CPA Economics Team warned that the U.S. solar industry is being threatened by China’s overcapacity and that China’s solar companies are surviving on CCP subsidies.

“We applaud Senators Brown, Cassidy, Ossoff, and Scott for introducing this bipartisan bill to prohibit China from receiving IRA tax credits funded by American taxpayers,” said Michael Stumo, CEO of CPA. “CPA strongly supports the IRA, which has already led to billions of dollars in investment in new manufacturing capacity, but it is critical that Congress close the loophole that allows Chinese companies—which are already subsidized by the CCP and are violating U.S. trade law—to be eligible for IRA tax credits.”