CS S.B. 1183 75(R)BILL ANALYSIS WAYS & MEANS S.B. 1183 By: Brown (Holzheauser) 5-5-97 Committee Report (Unamended) BACKGROUND Chapter 153, Tax Code (Motor Fuels Taxes), establishes the time-lines for paying taxes on motor fuels, taking credits against motor fuels taxes, or claiming refunds for taxes overpaid. Section 111.108, Tax Code (Recovery of Refund or Credit), allows the Comptroller of Public Accounts four years to recover deficiencies, or overpayments of refunds and credits, while Section 153.119, Tax Code (Refunds of Taxes Paid on Excepted Uses of Gasoline), only allows petroleum marketers one year to take credits and claim refunds. Persons with diesel tax prepaid user permits allowing them to transfer fuel from an unattended fuel storage location into their motor vehicles have prepaid the diesel motor fuels tax to the Comptroller's Office. In many areas of rural Texas these users receive their fuel for established tax free purposes from an unattended bulk fuel storage facility. These users access the stored fuel on their own and are then billed for the fuel by the petroleum marketer owning the storage facility. PURPOSE The bill makes two changes in the administration and collection of motor fuels taxes: 1) the permissible period to claim a tax refund or credit is extended from one to four years; 2) allows persons holding diesel tax prepaid user permits to transfer diesel fuel tax-free from an unattended storage location into their motor vehicles. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS SECTION 1.Amends Section 111.107, Tax Code (When Refund or Credit is Permitted), by establishing specific statute of limitations for refunds or credits related to overpayments of motor fuels taxes under Chapter 153, Tax Code. SECTION 2.Amends Section 153.119(e), Tax Code (Refunds of Taxes Paid on Expected Uses of Gasoline), by deleting the language relating to the one year statute of limitation for a tax credit which may be claimed for gasoline that has been exported, lost by accident, or sold to the U.S. Government. SECTION 3.Amends Section 153.1195, Tax Code (Refunds and Credits for Bad Debts), by adding Subsection (e) providing that a credit under this section must be taken before the expiration of the applicable (four year) limitation period as provided by Chapter 111, Tax Code (Collection Procedures). SECTION 4.Amends Section 153.121, Tax Code (When Gasoline Tax Refund May be Filed), by adding Subsection (d) which provides that a permitted distributor who determines taxes were erroneously reported and remitted or paid more taxes than were due because of a mistake of fact or law may take credit on the monthly tax report on which the error has occurred and tax payment made to the comptroller. Establishes that this credit must be taken before the expiration of the applicable (four year) period of limitation as provided by Chapter 111, Tax Code (Collection Procedures). SECTION 5.Amends 153.2225, Tax Code (Refunds and Credits for Bad Debts), by adding subsection (e) to provide that a credit under this section must be taken before the expiration of the applicable (four year) period of limitation as provided by Chapter 111, Tax Code (Collection Procedures). SECTION 6.Amends Section 153.224, Tax Code (When Diesel Fuel Tax Refund May be Filed), by adding Subsection (d) which provides that a permitted supplier or bonded user that determines taxes were erroneously reported or paid more taxes than were due because of a mistake of fact or law may take credit on the supplier or bonded user tax report on which the error has occurred and tax payment made to the comptroller. Provides that the credit must be taken before the expiration of the applicable (four year) period of limitation as provided by Chapter 111, Tax Code (Collection Procedures). SECTION 7.Effective date: October 1, 1997. SECTION 8.Emergency clause.