House Report: CCP's Tax Rebates Help Fund US Fentanyl Crisis

The Chinese Communist Party is helping to fund the U.S. fentanyl crisis through tax rebates and other financial incentives that subsidize companies that make and export materials used to make the drug, according to a House panel report released Tuesday. 

“Through subsidies, grants, and other incentives, the PRC [People's Republic of China] harms Americans while enriching PRC companies," according to the House Select Committee's findings on the CCP, reports NBC News. ​​

The report was released before a scheduled hearing Tuesday, during which Chairman Mike Gallagher, R-Wis., and ranking member Raja Krishnamoorthi, D-Ill., are expected to argue in detail China's role in funding the fentanyl crisis.

Fentanyl overdoses are the "leading cause of death for Americans aged 18-45," the report states. 

The report also revealed that the CCP:

• Directly subsidizes the manufacturing and export of fentanyl materials and other synthetic narcotics through tax rebates. 
• Gave grants and awards to companies that openly trafficked fentanyl materials and synthetic narcotics.
• Has an ownership interest in several Chinese companies linked to drug trafficking.
• Does not prosecute manufacturers of fentanyl and precursor materials.
• Does not cooperate with U.S. law enforcement and notifies targets of investigations.
• Allows sales openly of fentanyl precursors and other materials on the "extensively monitored and controlled" Chinese internet.
• Censors content on domestic drug sales while leaving export-focused narcotics content untouched.
• Benefits strategically and economically from the fentanyl crisis.

There are also no new criminal enforcement actions curbing the flow of fentanyl components into the United States, the committee said in the report.

"This failure — when combined with new evidence establishing the PRC incentivizing the export of illegal drugs abroad and ownership stake in companies doing the same — casts doubt on the veracity of the PRC’s claims that it will act to stem the massive export of illicit fentanyl materials and other dangerous synthetic narcotics, and reinforces the need for global cooperation and communication between law enforcement agencies," the report states.

The report comes after the panel launched an investigation into the role the CCP has played in the fentanyl crisis. The probe included examining Chinese websites, identifying online narcotics sales, and analyzing documents from the government.

The panel suggests in its report the establishment of a joint task force to focus on targeting weaknesses in the global fentanyl supply chain, as well as backing sanctions on authorities and strengthening measures to restrict fentanyl trafficking.

Further, the report calls for closing regulatory gaps that allow the trafficking to take place. 

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