Ending Fuel Tax Credits Bill

Official: Restoring Fuel Market Freedom Act of 2025

IntroducedJanuary 9, 2025

Taxation

Why This Matters

This bill aims to eliminate several tax credits that support the production of alternative fuels like alcohol and biodiesel. By doing this, it changes how these fuels are taxed and could impact their production costs.

If you produce or use alternative fuels, your costs could increase due to the loss of tax credits.

Affects: Producers of alcohol fuels, biodiesel, and sustainable aviation fuels would be directly affected by this bill.

Summary

Restoring Fuel Market Freedom Act of 2025This bill repeals multiple fuel-related federal tax credits and the credit or refund of federal fuel excise taxes paid on certain fuels used for nontaxable purposes. Specifically, the bill repeals thebusiness tax credit for clean fuel production (tax credit for the production of clean fuels produced after 2024 and sold before 2028); business tax credit for second-generation biofuel producers (tax credit for the production before 2025 of fuel derived from qualified feedstocks that meets certain other requirements); business tax credit for biodiesel fuels (tax credit for biodiesel fuel sold or used before 2025); business tax credit for sustainable aviation fuel (tax credit for sustainable aviation fuel sold or used before 2025); andtax credit for alcohol fuel, biodiesel, and alternative fuel mixtures (tax credit for alcohol fuel, biodiesel, and alternative fuel mixtures sold or used before 2025). Finally, the bill repeals expired provisions that allow a credit or refund of excise taxes paid on alcohol, biodiesel, alternative fuel, or sustainable aviation fuel that is used for nontaxable purposes.