Government Earns 400% ROI on Ethanol Blender’s Credit
by Mark (Corn Commentary) …The next issue can already be seen on the horizon and it can be seen clearly because it is not a “new” criticism. It is called the Volumetric Ethanol Excise Tax Credit (VEETC). This is the incentive put in place to encourage gasoline marketers to blend 10% ethanol in a gallon of gasoline. It is the carrot that got the entrenched oil industry to rethink their century old product mix and make it better.
Yes, you heard me right; the tax incentive goes to gasoline blenders, not the ethanol industry. Despite this, rest assured, the anti-ethanol cronies will scream ethanol subsidy when discussion about renewing VEETC begin in earnest. Regardless, VEETC is working and the facts speak for themselves. According to Bill McInturf, a Director at CFO Systems LLC in Omaha, NE the return on investment from the ethanol blender’s credit is 400%.
The Government’s 2008 $4.7 billion investment in the ethanol industry returned almost $20.0 billion in increased tax revenue and reduced farm program expenditures, leading Bill to say “This has to be one of the most financially successful government investments ever.” READ MORE
