Tax incentives provided by the US government to the country’s bio-fuel industry is expected to boost investments and provide impetus for future growth.
The government recently passed the American Taxpayer Relief Act of 2012 that allows companies to blend biodiesel with petroleum diesel with a $1 refundable tax credit for each gallon of biodiesel blended in the US.
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Bio-diesel developer Blue Sun has moved first to announce a fresh round of investments into the company, expected to be derived out of the credits earned in 2012.
The said investments will help the company advance its development of the next generation bio-fuel technologies.
Blue Sun CEO Leigh Freeman noted that the company plans to employ the incentives to fully commercialize its emerging technologies.
The tax incentives have been welcomed by several bio-fuel producers in the country who believe that the measures will help further boost the industry.
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By GlobalDataCanada-based Biox CEO Kevin Norton remarked that the incentive’s retroactive reinstatement and extension provides better clarity.
"The passage of this legislation is significant to BIOX as the retroactive clause allows us to recognize approximately Cdn$7 million in contingent revenue on product sold during calendar 2012, which will strengthen our earnings and cash position as part of the fiscal Q2 2013 reporting period," Norton said.
