The Restoring Fuel Market Freedom Act would repeal a package of federal tax credits that subsidize alternative and lower-emission fuels. Specifically, it eliminates the alcohol fuels credit, biodiesel credit, sustainable aviation fuel credit, clean fuel production credit, and the alcohol/biodiesel/alternative fuel mixtures credit. These credits currently support producers of ethanol, biodiesel, sustainable aviation fuel, and other fuels with lower lifecycle emissions than gasoline or jet fuel. Repeal would take effect for fuels produced or sold after enactment, removing financial incentives that have shaped the U.S. biofuels and clean-fuel industries for years.
Corporate Benefits
- Biofuel and clean-fuel producer credits — Repealed across alcohol fuels, biodiesel, sustainable aviation fuel, and clean fuel production
- Alcohol/biodiesel/alternative fuel mixtures credit — Eliminated for blenders and refiners
Environmental Concerns
- Sustainable aviation fuel credit — Repealed for fuel sold or used after enactment
- Clean fuel production credit — Section 45Z eliminated, ending per-gallon support for low-emission transportation fuels
- Biodiesel and alcohol fuels credits — Repealed, removing tax support for lower-lifecycle-emission fuels
Congressional 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.
Details
- Congress
- 119th
- Chamber
- House
- Status
- summarized
- Action
- Introduced in House
- Action Date
- 2025-01-09
- Date Added
- 2026-04-28
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