|Ethanol, Biodiesel Tax Credits in Tax Agreement|
|News Releases - Business, Economy & Finance|
|Written by Grassley Press|
|Thursday, 16 December 2010 14:48|
Common sense prevailed in the agreement reached last night on a tax proposal, including the fact that ethanol and biodiesel offer the most effective alternative to foreign oil and support hundreds of thousands of jobs in the United States.
The federal legislation contains an extension of the ethanol and biodiesel tax credits and an extension of the ethanol tariff at current rates. The U.S. Senate is scheduled to vote on the bill on Monday afternoon. The ethanol provision in this tax bill is an extension of current law. To leave it out of the tax bill would be a tax increase, which I don't support.
Americans spend $730 million a day on imported petroleum, and ethanol is the only renewable fuel substantially working to reduce U.S. dependence on foreign oil. Domestic ethanol displaces oil from Saudi Arabia, Venezuela and Nigeria. It now accounts for almost 10 percent of the U.S. fuel supply.
The billions of dollars we spend on imported petroleum prop up unfriendly governments and dictators. An average of $84 billion is spent each year by the U.S. military to protect oil transit routes. Until there’s another alternative fuel doing as much to reduce oil dependence, it would be foolish to undermine the only green, domestic alternative to imported oil.
I fought tooth and nail to secure the inclusion of both the ethanol and biodiesel provisions in the new legislative proposal. There were efforts by some congressional majority Democrats and the White House to weaken the tax policy for these alternative fuels. In fact, the current congressional majority allowed the blenders’ tax credit for biodiesel to expire at the end of 2009. Since then, 23,000 jobs in biodiesel have been lost nationwide. The new tax agreement would extend the biodiesel credit retroactively to cover all of 2010 and through the end of 2011.
We can’t risk a repeat performance with ethanol, where 112,000 jobs are at stake. Getting both of these tax provisions extended through the end of next year will boost jobs and investment in the alternative energy sector, exactly when the economy needs a real shot in the arm.
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