Repeal of Alcohol fuels credit

(a) In general Subpart D of part IV of subchapter A of chapter 1 of subtitle A is amended by repealing section 40 (and by striking the item relating to such section in the table of sections for such subpart). (b) Conforming amendments (1) Section 25C(d)(3)(B) is amended by inserting, as in effect on the day before the date of the enactment of the Restoring Fuel Market Freedom Act of 2025 after section 40. (2) Section 38(b) is amended by striking paragraph (3). (3) Section 40A is amended— (A) in subsection (d)(1),by striking 40 or in the matter following subparagraph (B), and (B) in subsection (f)(3), by striking may be determined under section 40 and inserting was allowable on the day before date of the enactment of the Restoring Fuel Market Freedom Act of 2025 under section 40. (4) Section 87 is amended by striking paragraph (1). (5) Section 168(l)(2)(A) is amended by inserting as in effect on the day before the date of the enactment of the Restoring Fuel Market Freedom Act of 2025 after section 40(b)(6)(E). (6) Section 196(c) is amended by striking paragraph (3). (7) Section 4101(a)(1) is amended by striking every person producing or importing sustainable aviation fuel (as defined in section 40B), and every person producing second generation biofuel (as defined in section 40(b)(6)(E)) and inserting and every person producing or importing sustainable aviation fuel (as defined in section 40B). (8) Section 4104(a)(1) is amended by striking, 40,. (9) Section 6426 is amended— (A) in subsection (b)(2)(C), by striking described in section 40(h)(3)(B) and all that follows through 2007, and inserting, in consultation with the Administrator of the Environmental Protection Agency, that, with respect to any taxable year, that an amount less than 7,500,000,000 gallons of ethanol (including cellulosic ethanol) has been produced in or imported into the United States in all preceding calendar years beginning after 2007,, (B) in subsection (g), by inserting as in effect on the day before the date of the enactment of the Restoring Fuel Market Freedom Act of 2025 after section 40(c), and (C) in subsection (h), by striking section 40, 40A, and inserting section 40A. (c) Effective date The amendments made by this section shall apply to fuels produced after the date of the enactment of this section.