Senate Considers Reviving Biodiesel Tax Credit of $1 a Gallon
The U.S. Senate Finance Committee leaders revealed Monday that included in the current stimulus package being proposed to create jobs and cut taxes is a provision to revive the $1 per gallon tax credit on biodiesel fuel. According to the the American Soybean Association, this incentive is desperately needed to stimulate the slumping soybean industry, since about 12% of the current soybean production goes into bio-fuels.
When the alternative fuel stipends ended in 2009, biodiesel production virtually came to a standstill. Lawmakers estimate that the new proposed incentives would cost taxpayers at least $1 billion dollars over the next 10 years. Also included in the proposed bill are provisions to:
-deny tax credits to "black liquor" which is a byproduct of paper manufacturing that has been utilized to generate power for paper mills
- a $1.98 million disaster relief program to assist farmers whose production is compromised by natural disasters.
Sounds pretty good, but after seeing the political sausage factory at work over the past year, we advise cautious optimism until we see a more final version of the bill.