Site last updated: Wednesday, September 2, 2026

Log In

Reset Password
Butler County's great daily newspaper

Senate repeals credits

Vote a setback for ethanol

WASHINGTON — The Senate voted Thursday to repeal tax credits for producing ethanol, a vote that budget cutters hope will demonstrate a growing appetite in Congress to end special interest tax breaks to help reduce government borrowing.

The Senate voted 73-27 to repeal the $5 billion annual subsidy, just two days after rejecting an identical measure. The tax credit provides 45 cents a gallon to oil refiners who mix gasoline with ethanol, a renewable, liquid fuel additive that comes mainly from corn in the U.S.

The measure will now be added to a bill renewing a federal economic development program. The prospects for the overall bill are uncertain, but Thursday’s vote clearly endangers the ethanol tax credit, which would expire at the end of the year anyway, unless Congress renews it.

The measure passed Thursday would end the tax credit immediately. It would also repeal a 54-cent-a-gallon tariff on imported ethanol, which restricts imports, mainly from Brazil.

In a sign that some ethanol subsidies are likely to endure, the Senate also voted 59-41 to reject a measure that would have eliminated a government program that supports the distribution of ethanol. The House had passed a similar measure earlier in the day, by a vote of 283-128, adding it to an agriculture spending bill.

The debate played out as the White House and congressional leaders continued to negotiate spending cuts to help reign in government red ink. Thursday’s vote will almost certainly make repealing the ethanol tax credit part of those discussions.

The federal government has already hit the legal borrowing limit of $14.3 trillion.

More in Business

Subscribe to our Daily Newsletter

* indicates required
TODAY'S PHOTOS