Young Secures Passage Of Alternative Fuel Tax Parity Provision

Press Release

On Wednesday, Congressman Todd Young's (R-IN) tax parity provision passed the House as part of an underlying bill to reauthorize federal highway and transit programs.

The bipartisan provision ensures that excise taxes on liquefied natural gas (LNG) and propane for highway use are levied at a rate consistent with their energy output relative to diesel and gasoline, respectively.

"Dozens of homegrown companies in my Indiana district have developed and adopted alternative fuel technologies," said Congressman Young. "This provision prevents Washington from picking winners and losers and provides this burgeoning sector of our economy equitable treatment within the federal tax code."

"It's important we level the playing field to encourage investments in these up-and-coming industries, especially those finding ways to utilize America's abundant domestic energy reserves," said Young. "This provision will spur private-sector innovation that is not just good for economic growth, but is lessening our dependence on foreign energy thereby enhancing our nation's overall security."

Highway use LNG produces 58% of the energy output of diesel, but is taxed at the same 24.3 cents per gallon rate. Similarly, propane produces 72% of the energy output of gasoline, but is taxed at the same 18.3 cents per gallon rate. The Alternative Fuel Tax Parity provision recognizes these disparities and sets the energy equivalent rates for LNG (14.1 cents per gallon) and propane (13.2 cents per gallon).

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