Consumer Relief and Opportunities for Producers Act; CROP Act
Summary
The Consumer Relief and Opportunities for Producers Act (CROP Act) aims to temporarily reinstate the biodiesel fuels credit by amending the Internal Revenue Code of 1986. Specifically, it extends the biodiesel fuels credit from December 31, 2024, to May 31, 2026. The bill also includes a provision to prevent double benefits, ensuring that no credit is given for fuel already receiving credit under section 45Z.
This bill modifies sections 40A(g), 6426(c)(6), and 6427(e)(6)(B) of the Internal Revenue Code. The amendments apply to fuel used or sold after November 30, 2025.
The bill was introduced in the Senate by Mrs. Blackburn on December 2, 2025, and referred to the Committee on Finance.
Expected Effects
The CROP Act's primary effect is to provide a tax incentive for biodiesel fuel production and use for an additional period. This extension could stimulate the biodiesel industry, potentially leading to increased production and consumption of biodiesel.
By preventing double benefits, the bill seeks to ensure that tax credits are applied efficiently and without redundancy. This could impact fuel producers and consumers by influencing the cost and availability of biodiesel.
Potential Benefits
- Potentially stimulates the biodiesel industry, leading to increased production.
- May lower the cost of biodiesel for consumers through tax credits.
- Could support agricultural producers by increasing demand for biodiesel feedstocks.
- May contribute to reduced greenhouse gas emissions compared to traditional fossil fuels.
- Could enhance energy security by promoting a domestically produced fuel source.
Potential Disadvantages
- The temporary nature of the credit creates uncertainty for long-term investment in the biodiesel industry.
- The cost of the tax credit could increase the federal budget deficit.
- The 'no double benefit' clause could create administrative complexity.
- Potential for unintended consequences in the fuel market due to the temporary incentive.
- The environmental benefits of biodiesel are debated and depend on production methods.
Most Disadvantaged Areas:
Constitutional Alignment
The CROP Act appears to align with the constitutional power of Congress to levy taxes and provide for the general welfare, as outlined in Article I, Section 8. The act does not appear to infringe upon any specific constitutional rights or limitations. The bill falls under the legislative powers granted to Congress.
However, the specific details of how the tax credit is implemented and its economic impact could be subject to scrutiny under the Commerce Clause if it unduly favors certain states or industries. The bill's focus on promoting domestic fuel production could be seen as an exercise of Congress's power to regulate commerce among the states.
Overall, the bill's constitutional alignment seems reasonable, as it primarily involves tax policy and economic incentives, which fall within the established powers of Congress.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).