Legislation to Reinstate Biodiesel Tax Credit Introduced in Senate
Washington Senator Maria Cantwell and Iowa Senator Chuck Grassley have introduced bipartisan legislation to reinstate a tax incentive for the production of domestic biodiesel. They say the incentive will help spur job creation and boost the nation's supply of cleaner alternatives to imported fossil fuels. S. 2021 - the Biodiesel Tax Incentive Reform and Extension Act of 2014 - would reform and extend the dollar-per-gallon tax credit for biodiesel producers through 2017. Congress allowed the credit to lapse at the end of 2013 and has allowed it to expire three times since the end of 2009. Cantwell says investing in America's clean energy economy is the smart thing to do for the environment and the nation's energy security. She notes biodiesel is America's first advanced biofuel - and says this legislation would give businesses the certainty they need to invest in the fuel and the development of affordable, domestic alternatives to fossil fuels. When investors suspend their funding of clean energy production - Grassley says jobs fall by the wayside. He says continuing incentives for biodiesel and other green energy sources supports jobs, helps the environment and increases energy independence. According to a release from the offices of Senators Cantwell and Grassley - industry growth stopped after Congress let the credit expire in 2012 - and production remained flat at just under 1.1-billion gallons - but when the credit was reinstated in 2013 - the U.S. biodiesel industry produced1.8-billion gallons.
Specifically - the legislation would provide a dollar-per-gallon tax credit for the production of biodiesel, renewable diesel and aviation jet fuel that complies with fuel standards and Clean Air Act requirements; increase the credit from one-dollar to $1.10 for the first 15-million gallons of biodiesel produced by small producers with an annual production capacity of less than 60-million gallons; eliminate potential abuses and simplify how the tax is administered by restricting the credit to fuel producers and excluding fuel blenders from eligibility; simplify the definition of biodiesel to encourage production from any biomass-based feedstock or recycled oils and fats; tighten compliance and reduce administrative burdens on taxpayers by simplifying the coordination between the income tax credit and the excise tax liability; and extends the tax credit for three years - giving needed financial predictability so that more facilities can be brought online in the United States.
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