Sponsors (3)
The bill trims and consolidates fuel tax provisions to simplify the Code and reduce federal tax expenditures, but it does so by removing credits and refunds that raise costs for fuel producers, slow low‑carbon fuel deployment, and create transitional compliance burdens likely felt by businesses and consumers.
All taxpayers and the IRS: the bill removes multiple specialized fuel-related credits and cross-references, narrowing and simplifying the tax code and reducing administrative complexity for taxpayers and tax administrators.
All taxpayers/federal budget: eliminating these credits and refunds reduces future tax expenditures and modestly increases federal revenue, easing deficit pressure compared with current law.
Certain producers, importers, and fuel purchasers: some firms will have simpler filings because they no longer must compute, track, or claim a range of fuel credits or refunds.
Fuel producers, blenders, sellers, and ultimately consumers: the repeal of multiple fuel credits and refund eligibilities raises costs for affected producers and sellers, which is likely to reduce production/investment and be passed through partly to consumers as higher fuel prices.
The public and climate policy goals: removing biodiesel, SAF, clean transportation fuel, and blending incentives weakens financial support for lower‑carbon fuels and may slow deployment of cleaner fuels and associated emissions reductions.
Taxpayers, small businesses, and the IRS: the multiple, immediate repeals and cross‑reference removals create transition, compliance, and guidance burdens and could increase disputes as filers and the IRS update systems and rules.
Based on analysis of 7 sections of legislative text.
Repeals multiple federal tax credits and certain excise refund/allowance provisions for alcohol fuels, biodiesel, SAF, and clean fuel production for post‑enactment fuels.
Official title: To amend the Internal Revenue Code of 1986 to repeal the alcohol fuels credit, the biodiesels fuel credit, the sustainable aviation fuel credit, the clean fuel production credit, the alcohol fuel, biodiesel, and alternative fuel mixtures credit, and other related provisions.
Introduced January 9, 2025 by Scott Perry · Last progress January 9, 2025
Repeals several federal tax incentives for low‑carbon and alternative transportation fuels. The bill eliminates the alcohol fuels credit, biodiesel credit, sustainable aviation fuel credit, the clean fuel production credit, related excise‑tax credits/refunds, and cross‑references in the Internal Revenue Code so those credits no longer apply to fuels produced, sold, used, or otherwise placed into commerce after enactment. The changes narrow statutory categories for tax refunds and alter tax and excise-treatment for fuel producers, importers, blenders, and some downstream purchasers. The repeal is implemented by removing the named Code sections and making numerous conforming edits across income‑tax and excise provisions; Treasury/IRS rules and excise‑tax refund processes will be affected, and the removals take effect for fuel produced, sold, used, or placed in commerce after the law’s effective date.