CQ.com reports:
Senate Finance Chairman Max Baucus is contemplating changes to the ethanol tax credit, Social Security taxes and property taxes to help pay for a bill that would give farmers new tax breaks. . . .
Reducing the 51-cents-per-gallon ethanol tax credit by 5 cents would save about $854 million over 10 years. The provision would take effect only after annual ethanol production reached 7.5 billion gallons. Last year, about 6 billion gallons were made.
While the provision could irritate corn state lawmakers who say current law is helping boost rural economies, biofuel advocates say they won’t fight the provision.
“This is . . . the natural evolution of the industry,” said Matt Hartwig, spokesman for the Renewable Fuels Association.
At the same time, Jon Doggett of the National Corn Growers Association says he has “some real misgivings” about the proposal. Any change in the tax credit should be hashed out in the energy bill, he said.