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House approves tax exemption for ethanol‑blended tractor fuel

Iowa House of Representatives · May 2, 2026
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Summary

The House adopted a measure (substituted Senate File 2493 / House File 2798) to exempt ethanol-blended fuel used in farm tractors from the motor fuel excise tax; sponsor said the change levels the playing field for an innovative ethanol-fueled tractor and the vote was 84–1 with 15 absent.

The Iowa House granted unanimous consent to substitute Senate File 2493 for House File 2798 and approved the measure to exempt certain ethanol-blended gasoline used exclusively for agricultural husbandry (prototype tractors and implement fuel) from the state excise tax.

Representative Clay said manufacturers are testing a tractor that runs on ethanol blended with a small amount of gasoline and noted the vehicles currently pay gas tax; the bill would align tax treatment with dyed diesel used off-road, "leveling the playing field" as the technology reaches market.

Floor managers urged members’ support and the clerk read the bill for final passage. The roll call recorded 84 ayes, 1 nay and 15 absent or not voting; the bill was declared to have received a constitutional majority and the title was agreed to.

Supporters characterized the bill as a narrow, technology‑neutral fix to avoid penalizing an evolving agricultural fuel technology; no floor amendments were adopted during the recorded consideration.