This bill amends existing yield tax laws to include properties that are enrolled or registered for the purpose of generating carbon offset credits. It introduces new definitions related to carbon credits, including "carbon credit," "entity and crediting entity," "carbon developer," and "tonnage," which clarify the terms used in the context of carbon sequestration. The bill establishes a yield tax of 10 percent on the estimated net value of carbon offset credits issued and sold in the previous calendar year for property owners involved in carbon sequestration. Additionally, it mandates that property owners file an intent to sequester carbon form when registering their projects and submit the total tonnage of carbon offset credits generated annually.

The bill also outlines the process for assessing the yield tax, including the calculation of the net value of carbon offset credits based on the average price per metric ton and the costs incurred by the carbon developer and landowner. It specifies that property owners must report their carbon offset credits to the carbon registry and the assessing officials in their municipality. The effective date for this act is set for April 1, 2026. Overall, the bill aims to incentivize carbon sequestration efforts by establishing a clear tax framework for property owners engaged in generating carbon offset credits.

Statutes affected:
Introduced: 79:5
As Amended by the House: 79:1, 79:3