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As part of its proposed taxed extenders package released Monday, the Senate Finance Committee included two items critical to soybean farmers, including a two-year extension of the dollar-per-gallon biodiesel tax incentive, and a reinstatement of the pre-2014 expensing amounts for farm infrastructure and equipment under Section 179.
Both issues are among the American Soybean Association’s policy priorities for the coming year, said ASA First Vice President Wade Cowan, a farmer from Brownfield, Texas,who issued a statement on the committee’s proposal
“More than 98 percent of American farms are owned by families, making ours an industry of small businesses, and like our counterparts on main streets across the country, farmers have a crucial stake in the country’s tax structure,” Cowan said, in a release distributed by ASA. “That’s why today’s proposal from the Senate Finance Committee is such an important one for agriculture. It extends the biodiesel tax credit through the end of 2015, and reinstates the amounts we can expense under Section 179. Both elements enable us to compete and succeed in the face of growing competition.”
Not extending the biodiesel tax credit was seen as a potential blow to soybean prices and the incentive to grow a market them as an alternative fuel source.
“The extension of the biodiesel tax credit is huge,” Cowan said. “Biodiesel blenders create a renewable and safe domestic energy source for our country and a valuable market for the soybean oil American farmers produce. The credit further encourages the development and sustained success of the biodiesel marketplace, and much credit goes to Chairman Wyden and Ranking Member Hatch and specifically Sens. Grassley and Cantwell for recognizing the importance of the biodiesel tax incentive and including it in their proposal.”
The industry had been operating without the credit since the end of the fiscal year in September, and Cowan said the result has been a dip in the biodiesel industry’s production dip. It has also stymied the development of what is still a relatively new industry.
“This proposal is a welcome first step toward putting the industry back on track for the next two years,” Cowan said. “The proposal’s Section 179 reinstatement is also important. It enables farmers and other small business owners to expense investments made in new technology, equipment and infrastructure in their operations. Given the land-based and capital-intensive nature of farming, not to mention the ever-advancing technology we need to farm sustainably and competitively, this program helps us to stay on the cutting edge of our industry.
“We hope that the full committee will take up and advance this proposal quickly, and we call on the full Senate and the House to pass these provisions in the interest of farmers and our fellow small business owners nationwide.”