The biochemical tax break would be aimed at companies that turn the byproducts of ethanol and biodiesel production into some other product. Mike St. Clair is a lobbyist for the Iowa Biotechnology Association.
The proposal calls for the state to set aside 10-million dollars a year for the next 10 years for the tax credit. Sinclair says his group will release an academic study in January to show the economic impact of the proposed tax credit.
John Stineman is the executive director of the Iowa Chamber Alliance, representing the state’s 16 largest chambers of commerce.
If the legislature approved the move, the tax credit would be available on a first-come, first-served basis. Companies that have been in business for less than five years would be eligible for a one-million dollar tax credit. More established companies that produce a new biochemical product would be eligible for a half a million dollar credit. Dried distiller’s grain is a byproduct when ethanol is made from corn and that’s already being sold. Ethanol and biodiesel plants in Iowa would have to come up with new products to be eligible for the tax credit.