BIO Written Testimony for House Ways and Means Hearing on Expired Tax Provisions
BIO supports a seamless multi-year extension for the Second Generation Biofuel Producer Tax Credit; Special Depreciation Allowance for Second Generation Biofuel Plant Property; Biodiesel and Renewable Diesel Fuels Credit; and the Alternative Fuel Vehicle Refueling Property, which expired at the end of 2017. BIO also supports the extension and expansion of the tax code to include the Qualifying Renewable Chemical Production or Investment Tax Credit and Master Limited Partnerships (MLP) to advanced biofuel and renewable chemicals.
BIO is pleased to submit a statement for the record to the United States House of Representatives Committee on Ways and Means Tax Policy Subcommittee hearing on "Post Tax Reform Evaluation of Recently Expired Tax Provisions.
The biofuel tax provisions that expired at the end of 2016 and were extended retroactively for 2017 are critical to BIO’s IES members. Particularly the Second Generation Biofuel Producer Tax Credit (PTC), the Special Depreciation Allowance for Second Generation Biofuel Plant Property, the Biodiesel and Renewable Diesel Fuels Credit, and the Alternative Fuel Vehicle Refueling Property Credit.
While BIO and its member companies are grateful Congress extended these provisions through 2017, the continued short-term extension of these incentives has created uncertainty for investors and the industry about the availability of these credits; jeopardizing the long-term investments necessary for the development of advanced and cellulosic biofuels. Availability of these credits are critical as our companies make significant investments to create new agricultural supply chains, build infrastructure for liquid biofuels, and develop innovative new technologies. These credits have enabled our industry to create new jobs, contribute to rural prosperity, and diversify our nation’s energy supply. However, the continued delays in extending these credits puts these investments and benefits at risk.
Ensuring further growth in the advanced and cellulosic biofuels industry will require additional support and greater policy certainty going forward. As such, we encourage the Congress to advance a multi-year extension of advanced biofuel tax. Motor fuel markets are not free markets. The oil industry receives permanent federal subsidies and tax breaks that give incumbents a market advantage over renewable fuels if not remedied by the counter balancing incentives described above. Temporary extensions are not enough to create parity, but they help bridge the gap to comprehensive energy tax reform. Allowing these tax credits to expire in the near term would be premature, and would significantly limit the growth in the domestic advanced and cellulosic biofuels industry and undermine all the positive contributions the indus