Congress Ends Taxpayer Funding Of Ethanol Subsidies

Overcharged

  Excerpt:

 .... two of the most wasteful subsidies ever to clutter the Internal Revenue Code went out with the old year. Congress declined to renew either the 45-cent-per-gallon tax credit for corn-based ethanol or the 54-cent-per-gallon tariff on imported ethanol, so both expired Dec. 31. Taxpayers will no longer have shell out roughly $6 billion per year for a program that badly distorted the global grain market, artificially raised the cost of agricultural land and did almost nothing to curb greenhouse gas emissions. A federal law requiring the use of 36 billion gallons of ethanol for fuel by 2022 still props up the industry, but the tax credit’s expiration is a victory for common sense just the same.

Comment: Image source: Congress Actually Ends Taxpayer Funding Of Ethanol Subsidies. Subsidies skew the free market and introduce inefficiencies. Other examples: the $7,500 electric vehicle tax credit (mentioned in the Wash Post editorial) that brought the Volt to the market; cash for clunkers, mortgage interest rate deductions, public transportation subsidies, etc.