On Tuesday June 13th the U.S. Senate voted 40-59 in favor of allowing the $5 billion annual subsidy on ethanol to expire at the end of this year. On Thursday, however, they voted to immediately repeal the Volumetric Ethanol Excise Tax Credit.
Opponents of the subsidy expressed concern about the deficit and suggested that the subsidy be either eliminated immediately or phased out over several years. Advocates of the subsidy emphasize the need to reduce foreign oil dependency.
White House spokesman Clark Stevens said President Barack Obama opposed the elimination of the subsidy but was “open to new approaches that meet today’s challenges and save taxpayers money.”
The Kentucky Corn Growers Association, a KCFC member, posted this statement from the National Corn Growers Association:
The National Corn Growers Association expressed severe disappointment today that the Senate allowed petty politics to trump prudent policy in the fight for the future of the ethanol industry. The passage of Sen. Dianne Feinstein's amendment to immediately repeal the Volumetric Ethanol Excise Tax Credit represents a tax increase on fuel that will kill jobs in rural America and hit all consumers in the pocketbook, NCGA said.
The ethanol industry supports more than 400,000 U.S. jobs, contributing more than $56 billion each year to the nation's economy and $11 billion in federal, state and local tax revenue.
Also Thursday, the Senate rejected a proposed amendment by Sen. John McCain that would have prevented the U.S. Department of Agriculture from providing grants for blender pumps.This is good news because blender pumps provide options for those with flex-fuel vehicles and can help the ethanol industry grow in the years to come.
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