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Senate advances measure to end ethanol tax credit

The Senate agreed Thursday to do away with an ethanol tax credit, a pivotal sign of waning support for industry subsidies amid mounting concerns over deficit spending and the nation’s mounting debt.

The 73-27 vote to advance the proposal drew support from across party lines as farm state senators found little backing for the tax break that government accountants have called duplicative and unnecessary.

Still, ending the ethanol credit is unlikely to happen soon, as the legislation was attached to a stalled economic development bill.

Despite pressure on Republican senators not to allow a tax hike by eliminating the nearly $6-billion annual subsidy, a majority of GOP senators gave their support in yet another signal of their willingness to do away with some tax breaks – a point that has become a critical factor in deficit-reduction talks with the White House.

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Thursday’s vote was a do-over on the proposal sponsored by Sen. Dianne Feinstein (D-San Francisco) and Sen. Tom Coburn (R-Okla.) that was rejected earlier this week, as Democrats largely opposed it on procedural grounds.


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