Senate Bill Would Provide Tax Equity For LNG
Richard Burr (R-N.C.) and Michael Bennet (D-Colo.) introduced the bill, the same one they sponsored last year, on Feb. 3.
The tax rate for LNG and diesel is 24.3 cents a gallon. However, LNG produces less energy per gallon than diesel. It takes about 1.7 gallons of LNG to equal the energy in a gallon of diesel, meaning that on an energy-equivalent basis, LNG is taxed at 170% the rate of diesel, the senators said.
CNG already is taxed on an energy-equivalent basis.
“This is a no-brainer,” Burr said of the measure. “Our bill would eliminate a current tax disincentive for using LNG, a fuel that is not only environmentally cleaner but would also reduce our dependence on foreign oil.”
Bennett said: “LNG could be a better and more economical fuel choice for Colorado’s business owners, but the current tax system has built in disincentives that may prevent them from using it.”
Natural Gas Vehicles for America, a group advocating greater use of natural gas in transportation, lauded the senators for pressing for LNG tax equity, which also is supported by American Trucking Associations.
“Senators Burr and Bennet recognize the important role that clean-burning, domestic natural gas can play in improving our air and supporting American jobs at home,” NGVAmerica President Matthew Godlewski said in a Feb. 4 statement.
Their bill is “a solid signal that we’re getting close to resolving the federal roadblocks that are standing in the way of further accelerating natural-gas use in the trucking sector,” he added.
