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April 10, 2015

Additional Language Introduced To Be Attached To The Alternative Fuel Tax Credit


On March 26, 2015, Representative Todd Young (R-IN) introduced H.R.
1665, the Alternative Fuel Tax Parity Act, to amend the Internal Revenue Code
of 1986 to equalize the excise tax on liquefied natural gas (LNG) and liquefied
petroleum gas
(propane). This legislation would attach federal tax
parities for LNG and propane to the Alternative Fuel Tax Credit (AFTC) that
currently covers alternative fuel mixtures, alcohol fuel, and biodiesel. The
AFTC has expired and is awaiting renewal. If H.R. 1665 is attached to the AFTC,
LNG and propane would be taxed based on their energy output rather than volume,
changing the tax on LNG from 24.3 cents-per-gallon to 14.1 cents-per-gallon and
the tax on propane from 18.3 cents-per-gallon to 13.2 cents-per-gallon. The
bill is intended to level the playing field by taxing LNG and propane at the
same energy based rate as gasoline. Gasoline is currently taxed at 18.3