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Exclusion of Biodiesel Tax Credit Disappointing

Exclusion of Biodiesel Tax Credit Disappointing

National Biodiesel Board says they aren't giving up on extending the blenders credit.

A key ag tax break failed to make it into the payroll tax holiday extension, and the biodiesel tax credit's chances of being renewed this year, have now narrowed.

The National Biodiesel Board, the American Soybean Association and others lobbied for weeks to include a renewal of the expired biodiesel tax credit in an already controversial payroll tax extension.

In the end, the credit and many other tax breaks were kept out for fear their political weight could have toppled the now-successful payroll tax bill, a disappointment to the Biodiesel Board and spokesman Ben Evans.

"Obviously that is a missed opportunity with that package," Evans said. "We felt that would be a good place for a tax extenders package. Unfortunately Congress decided to not do it in that bill."

Evans says his industry's not giving up, and there may still be chances to extend the blender's credit before the November election, but he concedes to odds are getting tougher.

"There are limited opportunities," Evans said. "It is an election year, there's not going to be a whole lot of legislating and governing going on after a little while here. We do feel like it is an urgent situation, we think our supporters on the Hill know that and are pushing hard to include it."

In the meantime the National Biodiesel Board continues to pursue from EPA a more robust 2013 renewable fuels standard of 1.3 billion gallons. The industry topped a billion gallons last year. The agency has delayed a decision, pending further review. Evans says it's too soon to tell how quickly biodiesel plants will take losses from the expired tax credit.

"We do know the numbers in January are going to be down a lot from the pace the industry was doing at the end of the year," Evans said. "When the industry did 160 million gallons in December, that was a record by far. Clearly people were producing biodiesel at a very fast pace at the end of the year."

And after the loss of the credit in 2010, before it was renewed last year, Evans says many producers are now probably holding off to see what happens next with the tax credit.

TAGS: Soybean
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