Restoring Fuel Market Freedom Act of 2025

This bill would end several federal tax breaks for certain fuels. It repeals tax credits for alcohol fuels, biodiesel, sustainable aviation fuel, and clean fuel production. It also ends the credit for mixing alcohol, biodiesel, or other alternative fuels with traditional fuel, and removes some old payment rules tied to fuels not used for taxable purposes. These changes would apply going forward, not retroactively, based on when fuel is produced, sold, or used after the bill becomes law (details below).

Key points:

• Who is affected: Businesses that make or blend these fuels, and others who currently claim these fuel-related tax credits.
• What changes:
  • Repeals the alcohol fuels credit
  • Repeals the biodiesel fuel credit
  • Repeals the sustainable aviation fuel credit
  • Repeals the clean fuel production credit
  • Repeals the credit for alcohol, biodiesel, and alternative fuel mixtures
  • Removes expired payment provisions for certain fuels not used for taxable purposes
• When it takes effect:
  • Alcohol fuels credit repeal applies to fuels produced after enactment
  • Biodiesel and sustainable aviation fuel credit repeals apply to fuel sold or used after enactment
  • Clean fuel production credit repeal applies to transportation fuels produced after enactment
  • Fuel-mixtures credit repeal applies to fuel used or sold after enactment