U.S. Senator Charles Grassley, an Iowa Republican, plans to introduce legislation that would tie an ethanol tax break to the price of oil, said Matt Hartwig, a spokesman for the Renewable Fuels Association in Washington.
The measure, which Grassley may offer today, would convert the 45-cent credit into a “variable tax credit that would adjust based on the price of oil,” Hartwig said in an e-mail.
A group of Democratic and Republican senators yesterday introduced legislation to repeal the credit, which is estimated to cost $6 billion a year, and a tariff on ethanol imports.
The credit, which helps the corn ethanol industry, is set to expire this year.