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SSB 3025

A bill for an act relating to the excise tax on certain ethanol blended gasoline purchased exclusively for use in an implement used in agricultural production.

2025-2026 Regular Session

Iowa bill exempts ethanol-blended gasoline from excise tax for agricultural equipment, reducing farmer fuel costs but decreasing state transportation revenue.

Subcommittee Meeting: 01/20/2026 11:00AM Room G15.
#ethanol #excisetaxes #farming #fueltaxes #gasoline #processingandproduction #taxexemptions #agriculture #revenuedepartment
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Bill Summary · SSB 3025

Legislative bill overview

SSB 3025 proposes to exempt ethanol-blended gasoline from Iowa's excise tax when purchased exclusively for use in agricultural equipment and machinery. The bill would create a tax break specifically for farmers using fuel in implements dedicated to farm production.

Why is this important

Iowa is a major agricultural state where fuel costs significantly impact farm operating expenses. This exemption could reduce input costs for farmers but would also reduce state tax revenue that funds transportation infrastructure and maintenance.

Potential points of contention

  • Revenue impact: The bill reduces excise tax revenue without clearly identifying offsetting funding sources or estimating fiscal cost to the state budget
  • Implementation complexity: Determining what qualifies as "exclusively for agricultural use" and preventing misuse or fraud requires robust tracking and enforcement mechanisms
  • Equity concerns: The exemption benefits large-scale agricultural operations disproportionately, raising questions about fairness to other industries with high fuel costs (construction, transportation, manufacturing)

Compiled from official sources — confirm details with the bill’s official record.

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