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SF 2493

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

2025-2026 Regular Session

SF 2493 requires valid IDR exemption certificates to exempt ethanol-blended gasoline used in implements of husbandry, with suppliers storing records and purchasers liable if misuse

Signed by Governor.
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Bill Summary · SF 2493

Summary of Iowa Senate File 2493 (2025-2026)

Purpose

SF 2493 proposes changes to the Iowa excise tax treatment of certain ethanol-blended gasoline purchased exclusively for use in implements of husbandry (IFH) used in agricultural production. The bill aims to ensure that these purchases are exempt from excise tax unless properly documented, shifting compliance toward verifiable exemption certification.

Key Provisions

  • Scope of tax treatment

    • Applies to the excise tax collection on ethanol-blended gasoline purchased at a terminal or refinery rack for exclusive use in an implement of husbandry used in agricultural production.

  • Exemption certification requirement

    • Purchasers must substantiate the exempt purchase with an exemption certificate issued by the Iowa Department of Revenue (IDR).
    • The exemption certificate must be:
    • Complete and correct per IDR director requirements
    • Signed by the purchaser
    • Retained by the fuel supplier
    • Suppliers must retain exemption certificates for at least 3 years.

  • IDR enforcement and denial of sales

    • IDR is required to disallow all sales of the described fuel class unless the purchaser provides a valid exemption certificate.
    • If fuel purchased under an exemption certificate is used or disposed of in a nonexempt manner, the purchaser is solely liable for the excise tax and must remit it directly to IDR.

  • Comparative framework with other exempt fuels

    • The bill notes that current law already requires exemption certificates for tax-exempt sales of other fuels (compressed natural gas, liquefied natural gas, liquefied petroleum gas, hydrogen, and electric fuel). SF 2493 aligns the IFH ethanol-blended gasoline exemption process with these existing exemptions.

Who is Affected

  • Purchasers of ethanol-blended gasoline for IFH use in agricultural production (must obtain and present IDR exemption certificates).
  • Fuel suppliers/sellers who must collect, store, and retain exemption certificates for the required period (at least 3 years) and enforce IDR’s exemption verification.
  • IDR (Iowa Department of Revenue), which administers the exemption certificates and has the authority to disallow tax-exempt sales lacking proper documentation, and to collect excise tax from purchasers if noncompliance occurs.

Procedural and Timeline Aspects

  • Introduction and committee actions

    • Introduced to the Iowa legislature and placed on the Ways and Means calendar.
    • Committee report indicates approval of the bill.

  • Implementation considerations

    • Effective date is not specified in the provided text; typically, a bill would include an effective date or date-of-enactment to begin enforcing the new exemption certification requirements.
    • Administrative process centers on IDR-issued exemption certificates and supplier recordkeeping for three years.

Potential Impact

  • Administrative compliance: Heightened verification of exemptions may reduce improper tax-free sales of ethanol-blended gasoline used in agriculture.
  • Tax liability clarity: Purchasers are clearly informed that improper use or disposal of exempt purchases can trigger sole excise tax liability to the purchaser.
  • Consistency with existing exemptions: Brings the IFH ethanol-blended gasoline exemption into alignment with other fuel exemption frameworks already managed by IDR.

If you’d like, I can tailor this summary for a policy brief, or expand any section with hypothetical implementation timelines or potential fiscal impact estimates based on comparable exemptions.

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

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