30 June 2011 03:12 [Source: ICIS news]
HOUSTON (ICIS)--Negotiations were continuing on Wednesday on a new plan to eliminate the US ethanol tax credit, according to a spokesman for one of three US senators reported to be working on the deal.
“Negotiations continue, but no deal has been finalised,” said Kyle Downey, a spokesman for Senator John Thune (Republican-South Dakota).
Thune and senators Dianne Feinstein (Democrat-California) and Amy Klobuchar (Democrat-Minnesota), were reported by news media to be working on a deal to end the US ethanol tax credit.
The tax credit could be replaced with other, less costly incentives for the biofuels industry.
The $6bn/year (€4bn/year) tax credit is scheduled to expire at the end of 2011.
The savings attained by eliminating the tax credit as early as 1 July could help reduce federal debt, according to news media reports.
The US Senate passed a measure on 16 June to eliminate the 45 cent/gal (12 cent/litre) credit, but that action was viewed as largely symbolic as the US House of Representatives was very unlikely to agree to such legislation.
The new plan was viewed as having enough alternative ethanol incentives to make it more palatable in the US House, according to news media reports.
($1 = €0.70)
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