Bill > S1103

This bill, titled the LNG Excise Tax Equalization Act of 2013, aims to adjust the federal excise tax on liquefied natural gas (LNG) to match that of diesel fuel based on their energy content. The Internal Revenue Code of 1986, which governs federal taxes, currently imposes the same per-gallon excise tax of 24.3 cents on both LNG and diesel. However, the bill highlights that a gallon of LNG contains significantly less energy (74,700 British Thermal Units, or Btu) compared to a gallon of diesel (128,700 Btu), meaning LNG provides only about 58% of the energy of diesel for the same tax amount. To equalize the tax burden based on energy provided, this bill proposes to define the "energy equivalent of a gallon of diesel" for LNG as the amount of LNG that has 128,700 Btu of energy content, and then apply the 24.3 cents per gallon tax to that equivalent amount. This change is intended to create a fairer tax system for alternative fuels and will take effect for sales or uses of LNG occurring after 14 days from the bill's enactment.