Modifies provisions relating to the biodiesel blend fuel seller tax credits
Summary
HB 1632 repeals and reenacts Missouri’s biodiesel blend fuel seller tax credit statute. The bill defines biodiesel blend, biodiesel fuel, B99, retail dealer, distributor, and retail service station, and then authorizes a state income tax credit for retail dealers and distributors that sell qualifying biodiesel blends in Missouri beginning with tax years on or after January 1, 2023. The credit is set at 2 cents per gallon for blends between 5% and 10% biodiesel and 5 cents per gallon for blends over 10% up to 20% biodiesel.
The bill makes the credit refundable, prohibits transfer, sale, or assignment of the credit, and caps total annual credits at $16 million. If claims exceed the available amount, the credits must be prorated among eligible claimants. The Department of Revenue is authorized to require documentation, work with the Department of Agriculture’s weights and measures division to verify biodiesel content, and promulgate rules to administer the program. The program is also subject to Missouri’s sunset law and would automatically expire on December 31, 2028 unless reauthorized.
Impact
HB 1632 would amend section 135.775, RSMo, by replacing the existing biodiesel blend fuel tax credit framework with a new version that expands and clarifies eligibility and administration. It affects retail fuel sellers and distributors that market biodiesel blends to final users in Missouri, while also involving the Department of Revenue and the Department of Agriculture in verification and rulemaking. The bill would create a refundable income tax credit tied to biodiesel blend sales, impose a statewide annual cap, and establish a sunset date for the program.
Sentiment
Based on the bill text and available context, the measure appears generally supportive of biodiesel use and the biodiesel fuel market, with no recorded committee transcript or vote history indicating opposition or debate. The bill’s structure suggests a policy preference for encouraging higher biodiesel blends through tax incentives while keeping the program limited by a fiscal cap and sunset date. Because no discussion snippets or votes are available, the overall sentiment can only be characterized as favorable in purpose but untested in the available record.
Contention
The main potential points of contention are fiscal cost, program administration, and eligibility verification. The $16 million annual cap and refundable nature of the credit could raise concerns about state revenue exposure, while the requirement to verify biodiesel percentages may create compliance and enforcement issues for sellers and state agencies. Another possible issue is the exclusion of biodiesel produced from palm oil unless it is contained in waste oil and grease collected in the United States, which could affect suppliers and fuel sourcing choices. No specific opposing or supporting stakeholders are identified in the available committee or vote record.
Transportation: motor fuel tax; incentives for the sale and production of biodiesel; provide for. Amends 1967 PA 281 (MCL 206.1 - 206.847) by adding sec. 679.
Transportation: motor fuel tax; incentives for the sale and production of biodiesel; provide for. Amends 1967 PA 281 (MCL 206.1 - 206.847) by adding sec. 279.
A bill for an act modifying the sales or use tax refund for biodiesel production, and including retroactive applicability provisions.(Formerly SF 2275, SSB 3102.)