House File 1053 - Introduced HOUSE FILE 1053 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO HSB 237) A BILL FOR An Act relating to fuel taxation by extending tax credits 1 for E-15 gasoline, and modifying the sales tax refund for 2 biodiesel production. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 1653HV (2) 91 jm/jh

H.F. 1053 Section 1. Section 422.11O, subsection 5, paragraph b, Code 1 2025, is amended to read as follows: 2 b. This subsection is repealed January 1, 2026 2029 . 3 Sec. 2. Section 422.11Y, subsection 4, paragraph b, Code 4 2025, is amended to read as follows: 5 b. The designated rate of the tax credit is nine cents , 6 except that for calendar year 2028 the designated rate is four 7 and one-half cents . 8 Sec. 3. Section 422.11Y, subsections 7 and 9, Code 2025, are 9 amended to read as follows: 10 7. Any credit in excess of the retail dealer’s tax liability 11 shall be refunded , except any credit in excess of the retail 12 dealer’s tax liability for calendar year 2028 shall not be 13 refunded . In lieu of claiming a refund, if available, the 14 retail dealer may elect to have the overpayment shown on the 15 retail dealer’s final, completed return credited to the tax 16 liability for the following tax year. 17 9. This section is repealed January 1, 2026 2029 . 18 Sec. 4. Section 422.33, subsection 11D, paragraphs b and c, 19 Code 2025, are amended to read as follows: 20 b. Any E-15 plus gasoline promotion tax credit which is in 21 excess of the taxpayer’s tax liability shall be refunded as 22 provided in section 422.11Y, or may be shown on the taxpayer’s 23 final, completed return credited to the tax liability for the 24 following tax year in the same manner as provided in section 25 422.11Y . 26 c. This subsection is repealed January 1, 2026 2029 . 27 Sec. 5. Section 423.4, subsection 9, paragraph b, Code 2025, 28 is amended to read as follows: 29 b. The amount of the refund shall be calculated by 30 multiplying a designated rate by the total number of gallons 31 of biodiesel produced by the biodiesel producer in this state 32 during each quarter of a calendar year. The designated rate 33 shall be four and one-half cents. 34 Sec. 6. 2011 Iowa Acts, chapter 113, section 37, as amended 35 -1- LSB 1653HV (2) 91 jm/jh 1/ 2

H.F. 1053 by 2016 Iowa Acts, chapter 1106, section 3, and 2022 Iowa Acts, 1 chapter 1067, section 57, is amended to read as follows: 2 SEC. 37. TAX CREDIT AVAILABILITY. For a retail dealer who 3 may claim an E-15 plus gasoline promotion tax credit under 4 section 422.11Y or 422.33, subsection 11D , as enacted in this 5 Act and amended in subsequent Acts, in calendar year 2025 6 2028 , and whose tax year ends prior to December 31, 2025 2028 , 7 the retail dealer may continue to claim the tax credit in the 8 retail dealer’s following tax year. In that case, the tax 9 credit shall be calculated in the same manner as provided in 10 section 422.11Y or 422.33, subsection 11D , as enacted in this 11 Act and amended in subsequent Acts, for the remaining period 12 beginning on the first day of the retail dealer’s new tax year 13 until December 31, 2025 2028 . For that remaining period, the 14 tax credit shall be calculated in the same manner as a retail 15 dealer whose tax year began on the previous January 1 and who 16 is calculating the tax credit on December 31, 2025 2028 . 17 EXPLANATION 18 The inclusion of this explanation does not constitute agreement with 19 the explanation’s substance by the members of the general assembly. 20 This bill relates to fuel taxation by extending the tax 21 credit for E-15 gasoline and modifying the sales tax refund for 22 biodiesel production. 23 The bill modifies the E-15 gasoline tax credit by extending 24 the repeal of the credit from January 1, 2026, to January 1, 25 2029. The bill reduces the tax credit from 9 cents per gallon 26 to 4.5 cents per gallon in calendar year 2028, and makes the 27 tax credit nonrefundable in calendar year 2028. 28 The bill amends the Iowa Acts to ensure the availability of 29 the E-15 gasoline tax credit for those retail dealers whose tax 30 year does not align with the repeal date of the E-15 gasoline 31 tax credit repeal date in the bill. 32 The bill increases the refund available to the producers of 33 biodiesel from 4 cents per gallon produced to 4.5 cents per 34 gallon produced. 35 -2- LSB 1653HV (2) 91 jm/jh 2/ 2