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A Better Way to Tax LNG Road Fuel

May 28, 2013 in LNG, NGVs, Regulations by Rich Piellisch  |  No Comments

The ‘LNG Excise Tax Equalization Act of 2013’

New federal legislation could make energy content – not volume – the basis for taxing liquefied natural gas as a road fuel, NGVAmerica reports.

NGVAmerica wants to see liquefied natural gas taxed by energy content, not volume.

NGVAmerica wants to see liquefied natural gas taxed by energy content, not volume.

Two U.S. congressman have introduced the LNG Excise Tax Equalization Act of 2013 (H.R. 2202), the association reports, and a similar bill is expected to be floated in the Senate.

H.R. 2202 would change the way LNG is taxed from a volume-gallon diesel gallon equivalent-energy content basis. The federal highway excise tax on both diesel and LNG is set at 24.3 cents per gallon. “However,” says NGVAmerica, “it takes about 1.7 gallons of LNG to equal the energy content of one gallon of diesel.

Inherent Penalty

“The result is the taxation of LNG at a rate 70% higher than diesel on an energy-equivalent basis.”

The federal effort is being matched several states, the association adds, most recently Texas and Oklahoma.


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Source: NGVAmerica with Fleets & Fuels follow-up

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