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Session of 2025
HOUSE BILL No. 2161
By Committee on Taxation
Requested by Gary Reser on behalf of Kansas Soybean Association
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AN ACT concerning taxation; relating to income tax; providing a tax
credit for the sale and distribution of biodiesel and renewable diesel
blends for motor vehicle fuels.
Be it enacted by the Legislature of the State of Kansas:
Section 1. (a) For taxable years 2026 through 2031, there shall be
allowed a credit against the tax liability imposed under the Kansas income
tax act for a retail dealer that sells a biodiesel blend or renewable diesel
blend at such retail dealer's retail service station or a distributor that sells a
biodiesel blend or renewable diesel blend directly to the final user located
in this state. The amount of the credit shall equal $0.05 per gallon of a
biodiesel blend or renewable diesel blend sold by the retail dealer and
dispensed through metered pumps at the retail dealer's retail service station
or by a distributor directly to the final user located in this state during the
tax year for which the tax credit is claimed.
(b) Any unused credit amounts may be carried forward for up to five
taxable years immediately following the taxable year for which the credits
were allowed. The credit shall not be refundable.
(c) The total amount of tax credits issued pursuant to this section shall
not exceed $5,000,000 per tax year.
(d) As used in this section:
(1) "Biodiesel blend" means a blend of diesel fuel and biodiesel fuel
of at least 10% for on-road or off-road diesel fueled vehicle use, including
farm tractors and railroad trains.
(2) "Biodiesel fuel" means a renewable, biodegradable, mono alkyl
ester combustible liquid fuel that is derived from agricultural and other
plant oils or animal fats and that meets the most recent version of the
American society of testing and materials (ASTM) international D6751
standard specification for biodiesel fuel blend stock. A fuel shall be
deemed to be biodiesel fuel if the fuel consists of a pure B100 or B99
ratio. Biodiesel produced from palm oil is not biodiesel fuel for the
purposes of this section unless the palm oil is contained within waste oil
and grease collected within the United States.
(3) "Distributor" means a person, firm or corporation doing business
in this state that:
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(A) Produces, refines, blends, compounds or manufactures motor
fuel;
(B) imports motor fuel into the state; or
(C) is engaged in distribution of motor fuel.
(4) "Renewable diesel" means a hydrocarbon fuel derived from
biomass meeting the requirements of ASTM standards D975 or D396.
Fuels that have been co-processed shall not apply.
(5) "Renewable diesel blend" means a blend of renewable diesel of at
least 10% for on-road or off-road diesel fueled vehicle use, including farm
tractors and railroad trains.
(6) "Retail dealer" means a person, firm or corporation doing
business in this state that owns or operates a retail service station in this
state.
(7) "Retail service station" means a location in this state from which
higher biodiesel or renewable diesel blend is sold to the general public and
is dispensed directly into motor vehicle fuel tanks for consumption.
Sec. 2. This act shall take effect and be in force from and after its
publication in the statute book.
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