The National Biodiesel Board is vowing to fight what it considers abuse of the biodiesel tax credit. According to a release from the NBB, the original intent of the credit was to help the biodiesel industry get off the ground, but big oil companies now are trying to take advantage of it:
The NBB has been advised of a potential abuse of this program and is determined to see that it is addressed in an expedient manner. Based on discussions with federal tax authorities, blenders and shippers, there is a suspicion that claims for the tax credit may have been submitted or are intended to be submitted in a way that we believe would constitute an improper use of the tax credit. Anecdotal evidence exists which suggests that foreign companies may be sending or planning to send tanker shipments of biodiesel into US ports, adding a small amount of diesel fuel, claiming the blenders credit on all biodiesel gallons in the shipment, and then exporting the shipment outside the United States.
This type of “re-exporting” activity was clearly not intended by the legislative policy and is an inappropriate use of the tax credit.
NBB officials promise to aggressively pursue legislation to close this loophole and keep the credit in the hands of those it was intended to help. They also encourage anyone who has information about questionable credits to contact the Internal Revenue Service at (213) 576-3837.