Congress Strikes Deal on Biodiesel Credit, Tobacco 21

Extending the credit and raising the tobacco purchase age win House approval in spending bill.

December 18, 2019

WASHINGTON—Congressional leaders forged a deal on a tax package with a hodge-podge of provisions affecting convenience and fuel retailers, including retroactively extending the biodiesel blenders' tax credit and raising the minimum age to purchase tobacco to 21. Lawmakers added the measures to a spending bill approved by the House Tuesday and slated for passage in the Senate before Congress adjourns.

Extending the biodiesel tax credit, at $1 per gallon, will be retroactive from 2018 through 2022. In addition, the tax package includes an extender for the expired oil spill liability tax, which will take effect January 1 but won’t be retroactive. An electric vehicle tax credit extension wasn’t included in the bill.

The tobacco 21 provision directs the Department of Health and Human Services (HHS) to promulgate a final rule within 180 days of enactment. Once published, the rule must go into effect within 90 days. The enforcement and penalty mechanisms in the Tobacco Control Act remain the same.

The bill also extends by one year certain tax breaks that were scheduled to lapse at the end of 2019, including incentives for investing in low-income areas and hiring workers from disadvantaged groups and a credit for employers that offer family leave, the Wall Street Journal reports.

President Trump is expected to sign the spending bill by midnight on Friday, December 20 to avoid a government shutdown. The spending bill lasts through the Sept. 30, 2020, end of the fiscal year.