Kelly Provision to Lower Energy Costs Signed into Law by President
Included in bipartisan 3-month highway bill
WASHINGTON — U.S. Representative Mike Kelly (R-PA) – a member of the House Ways and Means Committee – issued the following statement today regarding the inclusion of the language of the Energy Production Fairness Act(H.R. 898) in the final passage and enactment of the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 (H.R. 3236), which was signed into law by President Obama this afternoon. The provision – introduced as H.R. 898 by Rep. Kelly and Rep. Ron Kind (D-WI) in February – will amend propane’s excise tax provisions in the Internal Revenue Code in order to provide Federal excise tax equivalence to gasoline, which, according to Butane-Propane News, “will result in lower excise taxes being levied on propane used in auto fuel applications.”
Statement by Rep. Kelly:
“Today is a very good day for Western Pennsylvania, where propane is indispensable to our economy and our energy security. This tax-lowering provision will reduce heating bills for countless families and seniors in the Third District and help local energy providers create more jobs. It’s bipartisan, it’s commonsense, and now it’s law.”
Statement by Rep. Kind:
“Propane is an important part of our economy in central and western Wisconsin and I am pleased to see President Obama sign this important bill into law. This common sense, bipartisan change will help Wisconsinites save on their energy costs and make smart investments in alternative fuels to help our country become more energy independent.”
Statement by National Propane Gas Association:
“The excise tax equalization provision … will treat propane more fairly than the current structure. Since propane has a lower energy content than gasoline, it takes 1.37 gallons of propane to equal the energy in 1 gallon of gasoline. Consequently, on a proportional basis, more excise tax is paid for a gallon of propane than on a gallon of gasoline. But Sec. 2008 takes the appropriate approach to correct this inequity and tax propane on an energy content basis, thereby creating a level playing field across all auto fuels. Ultimately, this allows consumers to choose which fuels work best for them.”
“LNG and propane are both clean, readily available fuels, produced in the United States,” said Laura Lane, President of UPS Global Public Affairs. “Removing this economic disincentive in the tax code will speed the penetration of LNG and propane vehicles into the marketplace, and expand the use of LNG and propane vehicles on America’s roadways.”
NOTE: Rep. Kelly and Rep. Kind – founding members of the Congressional Propane Caucus – first introduced this provision as part of the Powering American Jobs Act of 2014 (H.R. 5775) on December 1, 2014. It was again introduced as a stand-alone bill on February 11, 2015, as the Energy Production Fairness Act (H.R. 898). The provision was included in the final bicameral passage of the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 (H.R. 3236) in Sec. 2008 and signed into law on July 31, 2015.
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