HBA-GUM, RBT C.S.S.B. 1547 76(R)BILL ANALYSIS
Office of House Bill AnalysisC.S.S.B. 1547
By: Bivins
Ways & Means
5/14/1999
Committee Report (Substituted)
BACKGROUND AND PURPOSE
Currently, this state's objective is to increase compliance with the motor
fuel tax, resulting in increased state revenues of $50 million and
increased federal appropriations of $48 million. C.S.S.B. 1547 sets forth
provisions regarding the collection of the motor fuels tax and provides
penalties.
RULEMAKING AUTHORITY
It is the opinion of the Office of House Bill Analysis that rulemaking
authority is expressly delegated to the comptroller of public accounts in
SECTION 2 (Section 153.003, Tax Code) of this bill.
SECTION BY SECTION ANALYSIS
SECTION 1. Amends Section 153.001, Tax Code, by amending Subdivisions (8)
and (19) and adding Subdivisions (28) - (36), to redefine "diesel tax
prepaid user," and "motor fuel," and define "blended fuel," "blending,"
"diversion number," "dyed diesel fuel," "export," "import," "import
verification number," "shipping document," and "undyed diesel fuel."
SECTION 2. Amends Section 153.003(a), Tax Code, to require the records of
each intrastate and interstate transportation of motor fuel required under
Subsection (b) to be compiled into a report and supplements in a form or
manner determined by the comptroller of public accounts (comptroller).
Requires, on or before the 25th day of the month following the end of each
calendar quarter, a common or contract carrier to file a report showing
complete and detailed information on the transportation of motor fuel
during the preceding quarter. Provides that the report must be executed by
the common or contract carrier or a representative of the carrier, and the
penalties provided by this chapter (Motor Fuel Taxes) apply to any
violation relating to the report. Requires the comptroller, by rule, to
determine the registration requirements for common or contract carriers
transporting motor fuel.
SECTION 3. Amends Section 153.004(d), Tax Code, by adding language to
require each person, other than a common carrier transporting motor fuel,
to also carry a copy of the dyed diesel fuel bonded user or agricultural
bonded user permit.
SECTION 4. Amends Section 153.006, Tax Code, by adding Subsection (e), to
authorize the comptroller to revoke a distributor's or supplier's permit if
the distributor or supplier purchases, for export, motor fuel in this state
on which the tax imposed by this chapter has not been paid and subsequently
diverts or causes the fuel to be diverted to a destination in this state or
to a destination in another state or country other than the originally
designated state or country without first obtaining a diversion number.
SECTION 5. Amends Section 153.010, Tax Code, to authorize the comptroller
or a peace officer, in order to enforce the provisions of this chapter, to
stop a motor vehicle that appears to operating with or transporting fuel in
order to examine the shipping document, cargo manifest, or invoices
required to be carried and make any other investigation that could
reasonably be make to determine whether the taxes have been paid or
accounted for by a distributor, supplier, dealer, dyed diesel fuel bonded
user, agricultural bonded user, jobber, or any person required to be so
permitted. Authorizes the certain persons to take samples of motor fuel
from any storage tank or container to draw certain conclusions.
SECTION 6. Amends Section 153.013(a), Tax Code, by adding language to
provide that a dyed diesel fuel bonded user, or agricultural bonded user
who fails to keep a record, issue an invoice, or file a report required by
this chapter, is presumed to have sold or used for taxable purposes all
motor fuel shown by an audit by the comptroller to have been sold to
certain entities. Makes conforming changes.
SECTION 7. Amends Subchapter A, Chapter 153, Tax Code, by adding Section
153.018, as follows:
Sec. 153.018. IMPORTATION AND EXPORTATION OF MOTOR FUEL. (a) Prohibits
a person from importing fuel to a destination in this state or exporting
motor fuel to a destination outside of this state by any means unless the
person possesses a shipping document for that fuel created by the terminal
or bulk plant at which the fuel was received. Sets forth the information
required to be included in the shipping document.
(b) Requires the terminal or bulk plant to provide shipping documents to
the importer or exporter.
(c) Requires the terminal to document the split loads by issuing shipping
documents that list the destination state of each portion of the motor
fuel, if motor fuel is to be delivered to more than one state.
(d) Sets forth required actions to be taken by a terminal, a bulk plant,
the carrier, the permitted distributor or supplier, and the person that
received the motor fuel.
(e) Requires an importer or exporter to keep in the person's possession,
the shipping document issued by the terminal or bulk plant when
transporting motor fuel imported into this state or for export from this
state. Requires the importer or exporter to show the document to the
comptroller or a peace officer on request. Authorizes the comptroller to
delegate authority to inspect the document to other governmental agencies.
Requires the importer or exporter to provide a copy of the shipping
document to the person that receives the fuel when it is delivered.
Authorizes the importer or exporter to deliver motor fuel only to the
destination state or states indicated on the shipping document.
(g) Requires an importer or exporter who wants to divert the delivery of a
single cargo tank of motor fuel from the destination state printed on the
shipping document to obtain a diversion number from the comptroller before
diverting the delivery. Provides that the importer, exporter, or common
carrier must write the diversion number on the shipping document issued for
the fuel. Requires a diversion number for each diverted delivery.
Authorizes the comptroller to appoint a person to assign diversion numbers,
or to delegate that authority to another person.
(h) Provides that an importer that acquires motor fuel for import by cargo
tank must obtain an import verification number from the comptroller before
importing the motor fuel. Provides that the importer must write the import
verification number on the shipping document issued for the fuel. Provides
that the importer must obtain a separate import confirmation number for
each cargo tank delivery of motor fuel into this state. Authorizes the
comptroller to appoint a person to assign import verification numbers, or
to delegate that authority to another person.
(i) Requires each terminal post to post a notice in a conspicuous location
proximate to the point of receipt of shipping papers that describes the
duties of importers and exporters. Authorizes the comptroller to prescribe
the language, type, style, and format of the notice.
SECTION 8. Amends Section 153.105(e), Tax Code, by adding language to
require the tax paid to the state under this section to be timely paid.
SECTION 9. Amends Section 153.112(a), Tax Code, to require, rather than
authorize, the comptroller to cancel a distributor's permit if no purchase,
sale, or use of gasoline has been reported by the distributor for the
prior nine months, rather than 12 months.
SECTION 10. Amends Section 153.117(a), Tax Code, to require a distributor
to keep an itemized statement showing by load, the number of gallons of all
gasoline exported and imported during the preceding calendar month, and
certain specified information related to the exportation or importation of
that fuel.
SECTION 11. Amends Section 153.118(a), Tax Code, to require a distributor
or other person liable to this state for payment of the tax imposed under
this chapter (Motor Fuel Taxes) to file all reports and supplements on or
before the 25th day of each month. Requires the report to be executed by
the distributor, the distributor's representative, or any other person
required to report and to be filed with the comptroller in a manner or on a
form provided or approved by the comptroller. Provides that the failure of
a distributor or other person to obtain forms or software from the
comptroller is no excuse for the failure to file a report containing all
the information required to be reported.
SECTION 12. Amends Section 153.203, Tax Code, to provide that the tax
imposed by this subchapter (Diesel Fuel Tax) does not apply to diesel fuel
sold or delivered by a permitted supplier to another permitted supplier or
to the bulk storage facility of an agricultural bonded user, or dyed diesel
fuel sold or delivered by a permitted supplier to the bulk storage facility
of a dyed diesel fuel bonded user.
SECTION 13. Amends Section 153.205, Tax Code, by amending Subsections (a),
(b), (c), (e), (i), and (j), and by adding Subsection (k), as follows:
(a) Provides that the first sale or use of diesel fuel in this state is
taxable, except that sales of dyed diesel fuel, or of undyed diesel fuel if
the fuel will be used for an agricultural purpose, may be made without
collecting the tax if the purchaser furnishes to a permitted supplier a
signed statement, including an end user number or agricultural user
exemption number issued by the comptroller that includes certain
stipulations.
(b) Prohibits a person from making a tax-free purchase of any diesel fuel
under this section using a signed statement for the purchase of more than
3,000 gallons of dyed or undyed diesel fuel in a single transaction. Makes
a conforming change.
(c) Provides that the signed statement and end user number or agricultural
user exemption number from the purchaser relieves the permitted supplier
from the burden of proof that the sale of diesel fuel was not taxable to
the purchaser and remains in effect unless certain conditions are met.
(e) Authorizes a person, however, to claim a refund of the tax paid on any
undyed diesel fuel used for nonhighway purposes under Section 153.222.
Makes conforming and nonsubstantive changes.
(i) Prohibits a supplier from making a tax-free sale of dyed diesel fuel,
or undyed diesel fuel for agricultural purposes, to a purchaser using a
signed statement under specified conditions. Makes conforming changes.
(j) Authorizes the sale of dyed diesel fuel, or undyed diesel fuel for
agricultural purposes, to be made without collecting tax from a purchaser,
rather than to a purchaser, who operates one or more motor vehicles on the
public highway and who furnishes to a permitted supplier a signed statement
and end user number or agricultural user exemption number only as provided
in this subsection. Makes conforming changes.
(k) Provides that a person who wants to use a signed statement to purchase
dyed diesel fuel must apply to the comptroller for an end user number to be
used in conjunction with the signed statement. Provides that a person who
wants to use the signed statement to purchase dyed or undyed diesel fuel
for agricultural purposes must apply to the comptroller for an agricultural
user exemption number to be used in conjunction with the signed statement.
Prohibits a person from making a tax-free sale of any diesel fuel to a
purchaser using a signed statement unless the purchaser has an end user
number or agricultural user exemption number issued by the comptroller
under this subsection.
SECTION 14. Amends Sections 153.206(h) and (i), Tax Code, as follows:
(h) Adds language to require the tax paid to the state under this section
to be timely paid.
(i) Provides that a dyed diesel fuel bonded user, an agricultural bonded
user, or a permitted interstate trucker is entitled to deduct one-half of
one percent of the taxable gallons of diesel fuel on payment of the taxes
to this state for the expense of recordkeeping, reporting, and remitting
the tax.
SECTION 15. Amends Section 153.207(a), Tax Code, to make a conforming
change.
SECTION 16. Amends Section 153.208(b), Tax Code, to make a conforming
change.
SECTION 17. Amends Section 153.209, Tax Code, as follows:
Sec. 153.209. New title: DYED DIESEL FUEL BONDED USER AND AGRICULTURAL
BONDED USER PERMITS. Provides that a dyed diesel fuel bonded user permit
authorizes a user to purchase more than 10,000 gallons a month of dyed
diesel fuel for the user's own use. Provides that an agricultural bonded
user permit authorizes a user to purchase more than 10,000 gallons of dyed
and undyed diesel fuel for the user's own use for agricultural purposes
only. Deletes existing text relating to purchasing diesel fuel for
nonhighway use tax-free.
SECTION 18. Amends Section 153.210(a), Tax Code, to provide that a diesel
tax prepaid user permit authorizes a person whose use of diesel fuel is
predominantly for agricultural nonhighway use, but owns or operates one or
more passenger cars or light trucks only in the weight class shown in this
section to elect to prepay an annual tax on the fuel delivered from his own
tax-free storage, rather than obtain an agricultural bonded user permit.
SECTION 19. Amends Section 153.214, Tax Code, to authorize a supplier to
operate under the supplier's permit as a dyed diesel fuel bonded user,
agricultural bonded user, dealer, or aviation fuel dealer.
SECTION 20. Amends Section 153.215, Tax Code, to provide that a supplier's
permit, a dyed diesel fuel bonded user permit, and an agricultural bonded
user permit are permanent and valid as long as the permittee has in force
and effect the required bond or security and furnishes timely reports and
supplements as required. Requires the comptroller to cancel a permit if no
purchase, sale, or use of diesel fuel has been reported by the permittee
for nine months. Deletes text authorizing the comptroller to cancel a
supplier's or bonded user's permit if no purchase, sale, or use of diesel
fuel has been reported by the supplier or bonded user for 12 months.
SECTION 21. Amends Section 153.217(a), Tax Code, to provide that a diesel
fuel bonded user on the list is qualified to purchase dyed diesel fuel tax
free during the following calendar year. Makes conforming changes.
SECTION 22. Amends Section 153.218(a), (b), (c), and (j), Tax Code, to
require the comptroller to notify immediately the issuer of a letter of
credit of a final determination of the supplier's, dyed diesel fuel bonded
user's, or agricultural bonded user's delinquent liability or a judgment
secured in any action. Makes conforming changes.
SECTION 23. Amends Section 153.219, Tax Code, by amending Subsections (a)
and (c), and adding Subsection (j), as follows:
(a) Requires a supplier to keep a record showing the number of gallons of
all diesel fuel sold, distributed, or used on which the tax was paid,
showing the name of each purchaser and the date of sale, distribution, or
use.
(c) Makes conforming changes.
(j) Sets forth the information a supplier is required to keep in itemized
statements.
SECTION 24. Amends Section 153.220, Tax Code, to make conforming changes.
SECTION 25. Amends Section 153.221(a) and (b), Tax Code, as follows:
(a) Requires a supplier, a dealer required to collect the tax under
Section 153.206(b) (relating to tax imposed on diesel fuel delivered by the
dealer), or a user required to pay the tax under Section 153.206(c)
(relating to tax imposed on diesel fuel delivered by the user) to file a
report of diesel fuel transactions or of diesel fuel delivered by a user
into the fuel tank of a motor vehicle owned or operated by the user and
such supplements as the comptroller may require, and remit the amount of
tax required to be collected or to be paid during the preceding month, on
or before the 25th day of each month. Requires a report to be filed on a
form or in a manner provided by the comptroller and to contain information
required by the comptroller, showing complete and detailed information of
diesel fuel transactions or use during the preceding month. Provides that
the failure of a supplier, dealer, or user to obtain forms or software from
the comptroller is no excuse for the failure to file a report.
(b) Requires a dyed diesel fuel bonded user, an agricultural bonded user,
or an interstate trucker to file a report and remit the amount of tax due
on or before the 25th day of each month following the end of each calendar
quarter. Deletes text requiring, on or before the 25th day of each month
following the end of each calendar quarter, a bonded user or interstate
trucker to file a report and remit the amount of tax due. Makes conforming
changes.
SECTION 26. Amends Section 153.222(d), Tax Code, to make conforming
changes.
SECTION 27. Amends Section 153.223(a), Tax Code, to prohibit a permitted
supplier from filing a claim for refund of taxes paid by a purchaser of
undyed diesel fuel.
SECTION 28. Amends Section 153.224(d), Tax Code, to make conforming
changes.
SECTION 29. Amends Subchapter C, Chapter 153, Tax Code, by adding Sections
1653.226153.230, as follows:
Sec. 153.226. NOTICE REGARDING DYED DIESEL FUEL. Sets forth the
requiredments of a notice stating "DYED DIESEL FUEL, NONTAXABLE USE ONLY,
PENALTY FOR TAXABLE USE."
Sec. 153.227. DYED DIESEL FUEL NOTICE REQUIRED ON SHIPPING DOCUMENTS,
BILLS OF LADING, AND INVOICES. Provides that the form of notice required
by Section 153.226 must be provided when the dyed diesel fuel is removed or
sold and must appear on each shipping document, bill of lading, cargo
manifest, and invoice accompanying the sale or removal of the dyed diesel
fuel.
Sec. 153.228. UNAUTHORIZED SALE OR USE OF DYED DIESEL FUEL. Prohibits a
person from selling or holding for sale dyed diesel fuel for any use that
the person knows or has reason to know is a taxable use of the diesel fuel.
Prohibits a person from using or holding for use dyed diesel fuel for a use
other than a nontaxable use if the person knows or has reason to know that
the diesel fuel is dyed diesel fuel.
Sec. 153.229. ALTERATION OF DYE OR MARKER IN DYED DIESEL FUEL PROHIBITED.
Prohibits a person, with the intent to evade payment of tax, from altering
or attempting to alter the strength or composition of a dye or marker in
dyed diesel fuel.
Sec. 153.230. USE OF DYED FUEL PROHIBITED. Prohibits a person from
operating a motor vehicle on a public highway in this state with taxable
motor fuel that contains dye in the fuel supply tank of the motor vehicle.
Provides that this section does not apply to a use of dyed fuel that is
lawful under the Internal Revenue Code and implementing regulations.
SECTION 30. Amends Section 153.401(a), Tax Code, to make a conforming
change.
SECTION 31. Amends Section 153.402, Tax Code, as follows:
Sec. 153.402. PROHIBITED ACTS; CIVIL PENALTIES. (a) Provides that a
person forfeits to the state a civil penalty of not less than $25 nor more
than $200, if the person is an importer who does not obtain an import
verification number when required by this chapter, or purchases motor fuel
for export, on which the tax imposed by this chapter has not been paid, and
subsequently diverts or causes motor fuel to be diverted to a destination
in this state or any other state or country other than the originally
designated state or country without first obtaining a diversion number.
(b) Provides that an importer or exporter that violates a requirement of
Section 153.018 is liable to this state for a civil penalty of $2,000 or
five times the amount of the unpaid tax, whichever is greater, for each
violation.
(c) Provides that a person receiving motor fuel who accepts a shipping
document that does not conform with the requirements of Section 153.018(a)
is liable to this state for a civil penalty of $2,000 or five times the
amount of the unpaid tax, whichever is greater, for each occurrence.
(d) Provides that a person operating a bulk plant or terminal who issues a
shipping document that does not conform with the requirements of Section
153.018(a) is liable to this state for a civil penalty of $2,000 or five
times the amount of the unpaid tax, whichever is greater, for each
occurrence.
(e) Provides that a person operating a terminal or bulk plant who does not
post notice as required by Section 153.018(i) is liable to this state for a
civil penalty of $100 for each day the notice is not posted as required by
Section 153.018(i).
SECTION 32. Amends Section 153.403, Tax Code, to provide that, except a
provided by Section 153.404 (Criminal Offenses: Special Provisions and
Exceptions), a person commits an offense if the person:
_uses dyed diesel fuel, on which a tax is required to be paid, for the
operation of a motor vehicle on a public highway;
_is an importer who does not obtain an import verification number when
required by this chapter; purchases motor fuel for export, on which the tax
imposed by this chapter has not been paid, and subsequently diverts or
causes to be diverted to a destination in this state or any other state or
country other than the originally designated state or country without first
obtaining a diversion number;
_is a distributor, supplier, dyed diesel fuel bonded user, agricultural
bonded user, dealer, interstate trucker, aviation fuel dealer, jobber, or
other person required to hold a permit under this chapter who fails to
retain a document as required by this chapter;
_transports in any manner motor fuel under a false cargo manifest or
shipping document, or transports in any manner motor fuel to a location
without delivering at the same time a shipping document relating to that
shipment;
_is a dealer who purchases motor fuel with the intent to evade any tax
imposed by this chapter, or who accepts delivery of motor fuel by any means
and does not at the same time accept or receive a shipping document
relating to the delivery;
_transports motor fuel for which a cargo manifest or shipping document is
required to be carried without possessing or exhibiting on demand by an
officer authorized to make the demand, a cargo manifest or shipping
document containing the information required to be shown on the manifest or
shipping document;
_imports, sells, uses, distributes, or store motor fuel within this state
on which the taxes imposed by this chapter are owed but have not been
first paid to or reported by the holder of a distributor, supplier,
liquefied gas dealer, interstate trucker, diesel tax prepaid user, dyed
diesel fuel bonded user, or agricultural bonded user permit;
_blends products together to produce a blended fuel that is offered for
sale, sold, or used that expands the volume of the original product to
evade paying applicable motor fuel taxes; or
_evades or attempts to evade in any manner, a tax imposed on motor fuel by
this chapter.
Deletes text providing that, except as provided by Section 153.404 of this
code, a person commits an offense, if the person transports motor fuel for
which a cargo manifest is required to be carried without possessing or
exhibiting on demand by a specified person an appropriate manifest . Makes
conforming changes.
SECTION 33. Amends Article 12.01, Code of Criminal Procedure, to establish
that the statute of limitations for a violation under Sections
153.403(22)-(39) is ten years.
SECTION 34. Amends Sections 153.404(b), (c), and (d), Tax Code, to make
conforming changes.
SECTION 35. Amends Section 153.405, Tax Code, as follows:
(a) Provides that an offense under Section 153.403(8), is a Class C
misdemeanor.
(b) Provides that an offense under Section 153.403(9), (16), (17), or (18)
is a Class B misdemeanor. Makes a conforming change.
(c) Provides that an offense under Section 153.403(19), (20) or (21) is a
Class A misdemeanor. Makes a conforming change.
(d) Provides that an offense under Sections 153.403(22), (23), (28) or
(29) is a felony of the third degree. Makes a conforming change.
(e) Makes conforming changes.
(f) Makes conforming changes.
SECTION 36. Provides that the change in law made by this Act does not
apply to an offense if the prosecution of the offense became barred by
limitation before the effective date of this Act. The prosecution of that
offense remains barred as though this Act had not taken effect.
SECTION 37. Provides that if Article 12.01 (Felonies), Code of Criminal
Procedure, as amended by this bill conflicts with Article 12.01, as amended
by S.B. 70, Acts of the 76th Legislature, Regular Session, 1999, the change
in law made by the amendment of this Act in Article 12.01 controls over the
change made by S.B. 70.
SECTION 38. Effective date: September 1, 2000.
Makes application of this Act prospective.
SECTION 39. Emergency clause.
COMPARISON OF ORIGINAL TO SUBSTITUTE
The substitute modifies SECTION 6 (Section 153.013(a), Tax Code) of the
original to make conforming changes.
The substitute modifies proposed Section 153.018(a)(2), Tax Code, in
SECTION 7, to provide that the shipping document must include the federal
employer identification number, or, if the employer identification number
is not available, the social security number of the carrier transporting
the motor fuel.
The substitute adds a new SECTION 8 and renumbers the subsequent SECTIONS
accordingly. New SECTION 8 amends Section 153.105(e), Tax Code, by adding
language to require the tax paid to the state under that section to be
timely paid.
The substitute modifies the original in SECTION 14 by amending Section
153.206(h), Tax Code, by adding language to require the tax paid to the
state under that section to be timely paid.
The substitute modifies the original in SECTION 23 (Section 153.219, Tax
Code) to delete proposed text specifying that the number of gallons of
diesel fuel sold, distributed, or used, as reflected in a required record
under Subsection (a), is fuel on which the tax was paid.
The substitute modifies the original in SECTION 38 by changing the
effective date of this Act to September 1, 2000, from September 1, 1999.