U.S. Senators Challenge Treasury on LNG Tanker Tax Credits Amid Environmental Concerns
A group of Democratic U.S. senators, including Jeff Merkley, Elizabeth Warren, and Chuck Schumer, have raised concerns with Treasury Secretary Scott Bessent regarding the eligibility of large liquefied natural gas (LNG) tankers for the Alternative Fuel Excise Tax (AFET) credit. This tax credit, originally established in 2005 under former President George W. Bush, was intended to promote the use of alternative fuels in smaller motorboats to reduce oil dependence. The senators argue that applying this credit to LNG tankers, which are significantly larger than the motorboats the credit was designed for, does not align with the credit's original purpose. They contend that it results in unnecessary taxpayer expenditure without environmental benefits, as LNG tankers already utilize LNG that boils off during transit. Cheniere Energy, a major player in the LNG sector, reportedly received a $370 million tax break under this credit, but has not commented on the matter.