Splash and Dash – US Taxpayers Lose Once Again

girl pumping biofuel splash and dash

US Taxpayers are getting screwed out of millions of dollars by a biofuel subsidy that helps to lower gas prices in Europe. Last year this subsidy cost the American taxpayer $300 million, and it’s projected to cost the American taxpayers $600 million in 2008.

The scam is known as “splash and dash.” It consists of an existing $1 subsidy for every gallon of biodiesel fuel blended with regular diesel in the United States. Biodiesel is produced abroad and shipped to the United States, where it’s blended with just a “splash” of regular diesel. For example, a tanker-load of about 9 million gallons of foreign biodiesel requires just 9,000 gallons of American diesel to make it qualify for the subsidy. But every gallon in the shipment receives a $1 subsidy that is paid by the US Government. The ship then makes a “dash” for Europe.

Each load of biodiesel, made from South American sugar cane or Asian palm oil, generates $9 million in tax credits for the importer/exporter. Congress and the National Biodiesel Board know the loophole is being exploited, they can see that the US is exporting much more biofuel than it is producing. But, they claim that they are unable to identify the companies that are “stealing” our money.

We need to immediately end “splash and dash” by eliminating the subsidy for any biodiesel exported from the United States. We all should be outraged that we are subsidizing Europe’s use of biodiesel at our own expense.

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