Time for Reinstatement of Biodiesel Tax Incentive

Congressman Ike Skelton urges action at press conference hosted by Missouri soybean farm.

Published on: Jun 28, 2010
Congressman Ike Skelton, D-Mo. joined the Missouri Soybean Association June 21 for a joint press conference at Miles Family Farm in Saline County to discuss pending legislation that could  have a lasting impact on farmers and biodiesel production.

Soybean farmers have been closely monitoring the status of H.R. 4213, the Tax Extenders Act, which would reinstate the biodiesel blenders' tax credit, a critical piece of policy for the industry that expired at the end of 2009. The Tax Extenders Act calls for the biodiesel tax credit to be retroactively extended through Dec. 31, 2010.

The bill has moved back and forth between the House and the Senate as additions to the measure and the costs associated with those additions have been debated. Most recently, the House passed a revised version of the bill, which Skelton voted in favor of, on May 28.

Congressman Ike Skelton called for Congress to quickly resolve the legislative stalemate on HR 4213 at a press conference on a Saline County soybean farm.

"It is important for Congress to quickly resolve this legislative stalemate," Skelton said. "Many Americans rely on tax cuts to make long-term financial decisions about farm and business operations each year. This is particularly true with respect to the U.S. biodiesel industry, which relies on federal tax credits to compete with big oil companies, which also receive federal assistance, and would like nothing more than to see homegrown energy producers put out of business."

The biodiesel tax incentive has helped increase the production and use of biodiesel in the U.S. In 2004, when the incentive was initially enacted, the U.S. produced 25 million gallons. By 2009, the U.S. was producing 545 million gallons of the clean-burning renewable fuel.

"In the last four years, U.S. soybean farmers received an additional $2.5 billion in net returns due to the biodiesel industry's demand for soybean oil," said Dale Ludwig, MSA executive director. "We applaud Congressman Skelton and the House of Representatives for passing the Tax Extenders Act and we urge the Senate to find a way to send it to the president's desk as soon as possible."

The bill would also extend the five-year depreciation for farming machinery and equipment, would extend the charitable tax deduction for donated food, and would extend the tax deduction for donating conservation easements.

Source: Missouri Soybean Association