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H0686.........................................by TRANSPORTATION AND DEFENSE
FUELS TAX - Adds to and amends existing law relating to fuel taxes to
increase the annual fee for gaseous fuel permits; to increase the amount
required to be secured by a distributor's bond; to provide that the bond
applies to the bonding requirements of Chapter 48, Title 63, Idaho Code; to
provide an exception to the taxation limitations of Chapter 24, Title 64,
Idaho Code; to provide definitions; to provide for imposition of the
highway preservation fuel tax; to provide for payment of the tax; to
provide for distribution of tax revenues; to require distributor reports;
to require bonding; to provide recordkeeping requirements; to provide for
revocation or cancellation of licenses; to provide penalties for doing
business in Idaho without a valid license; to provide for enforcement; to
authorize exchange of information agreements; to provide rulemaking
authority for administration of the program; and to provide for violations
and penalties.
03/25 House intro - 1st rdg - to printing
Rpt prt - Held at Desk
03/31 Ref'd to W/M
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]] Fifty-ninth Legislature Second Regular Session - 2008IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 686 BY TRANSPORTATION AND DEFENSE COMMITTEE 1 AN ACT 2 RELATING TO THE HIGHWAY PRESERVATION FUEL TAX; AMENDING SECTION 63-2424, IDAHO 3 CODE, TO INCREASE THE ANNUAL FEE FOR GASEOUS FUEL PERMITS; AMENDING SEC- 4 TION 63-2428, IDAHO CODE, TO INCREASE THE AMOUNT REQUIRED TO BE SECURED BY 5 A DISTRIBUTOR'S BOND AND TO PROVIDE THAT THE BOND APPLIES TO THE BONDING 6 REQUIREMENTS OF CHAPTER 48, TITLE 63, IDAHO CODE; AMENDING SECTION 7 63-2431, IDAHO CODE, TO PROVIDE AN EXCEPTION TO THE TAXATION LIMITATIONS 8 OF CHAPTER 24, TITLE 63, IDAHO CODE; AND AMENDING TITLE 63, IDAHO CODE, BY 9 THE ADDITION OF A NEW CHAPTER 48, TITLE 63, IDAHO CODE, TO PROVIDE DEFINI- 10 TIONS, TO PROVIDE FOR IMPOSITION OF THE HIGHWAY PRESERVATION FUEL TAX, TO 11 PROVIDE FOR PAYMENT OF THE TAX, TO PROVIDE FOR DISTRIBUTION OF TAX REVE- 12 NUES, TO REQUIRE DISTRIBUTOR REPORTS, TO REQUIRE BONDING, TO PROVIDE 13 RECORDKEEPING REQUIREMENTS, TO PROVIDE FOR REVOCATION OR CANCELLATION OF 14 LICENSES, TO PROVIDE PENALTIES FOR DOING BUSINESS IN IDAHO WITHOUT A VALID 15 LICENSE, TO PROVIDE FOR ENFORCEMENT OF THE PROVISIONS OF CHAPTER 48, TITLE 16 63, IDAHO CODE, TO AUTHORIZE EXCHANGE OF INFORMATION AGREEMENTS, TO PRO- 17 VIDE RULEMAKING AUTHORITY FOR ADMINISTRATION OF THE PROGRAM BY THE STATE 18 TAX COMMISSION AND TO PROVIDE FOR VIOLATIONS AND PENALTIES. 19 Be It Enacted by the Legislature of the State of Idaho: 20 SECTION 1. That Section 63-2424, Idaho Code, be, and the same is hereby 21 amended to read as follows: 22 63-2424. GASEOUS FUELS. (1) In the case of special fuels which are in a 23 gaseous form, the commission shall provide by rule the method to be used for 24 converting the measurement of the fuel to the equivalent of gallons for the 25 purpose of applying tax rates. The method provided shall cause the tax rate 26 provided in section 63-2402, Idaho Code, to apply to an amount of gaseous 27 fuels having energy equal to one (1) gallon of gasoline. 28 (2) As an alternative to the provisions of subsection (1) of this sec- 29 tion, an annual fee in lieu of the excise tax may be collected on a vehicle 30 powered by gaseous fuels. The rate of the fee shall be based on the following 31 schedule for all types of gaseous fuels as adjusted by the formula for prora- 32 tion set out below. The permits shall be sold by gaseous fuels vendors dis- 33 pensing gaseous fuels into motor vehicles. 34 VEHICLE TONNAGE (GVW) FEE 35 0 -- 8,000 $60.00105.00 36 8,001 -- 16,000 $89.00155.00 37 16,001 -- 26,000 $179.00313.00 38 26,001 and above $208.00364.00 39 Permits for vehicles which are converted to gaseous fuels after the first of 40 July in any year shall have the fee prorated for the appropriate number of 41 months until renewal. The commission shall provide by rule the method to be 42 used for converting the measurement of fuel to the equivalent of gallons for 43 the purpose of applying increases in tax rates after this law becomes effec- 2 1 tive. A decal issued by the commission shall be displayed in any vehicle for 2 which a permit is issued hereunder as evidence that the annual fee has been 3 paid in lieu of the fuel tax. This decal shall be displayed in a conspicuous 4 place. 5 SECTION 2. That Section 63-2428, Idaho Code, be, and the same is hereby 6 amended to read as follows: 7 63-2428. BONDING. (1) At the time an application for a distributor's 8 license under section 63-2427A, Idaho Code, is submitted to the commission, 9 the applicant shall file a bond with the commission conditioned upon faithful 10 performance of all of the requirements of this chapter and of chapter 48, 11 title 63, Idaho Code. The total amount of the bond shall be fixed by the com- 12 mission and shall be equivalent to at least twice the estimated average tax 13 liability for the reporting period for which the applicant will be required to 14 file a distributor's report under section 63-2406, Idaho Code, or section 15 63-4805, Idaho Code. The bond required by this section shall in no case be 16 less than one thousand five hundred dollars ($1,0500) nor more thantwothree 17 hundred thousand dollars ($2300,000). Based on prior years' experience, the 18 total amount required to be secured by the bond may be increased or reduced by 19 the commission at any time. The bond will be waived if the commission is sat- 20 isfied that the distributor has the financial responsibility to meet the 21 required bond amount. Financial responsibility may be determined by the com- 22 mission upon review of all relevant public documents including appropriate 23 county records and records of tax payments to the state of Idaho. The distrib- 24 utor can be required to provide a commercial credit rating, balance sheet, or 25 income statement to demonstrate present financial solvency, i.e. ownership of 26 real and/or personal property, the unencumbered value of which exceeds the 27 bond amount otherwise required. If such financial solvency is established, 28 and if the distributor has been doing business in Idaho as a licensed distrib- 29 utor for five (5) or more consecutive years without a default in the payment 30 of taxes imposed in this chapter or chapter 48, title 63, Idaho Code, finan- 31 cial responsibility shall be presumed. Any bond given in conjunction with 32 this chapter shall be a continuing instrument, and shall cover the period dur- 33 ing which the license in connection with which the bond is given is in effect, 34 unless the surety on the bond is released or discharged by the commission. Any 35 surety on any bond furnished by a licensee shall be discharged and released 36 from any and all liability to the state accruing on the bond after the expira- 37 tion of thirty (30) days from the date upon which the surety shall have lodged 38 with the commission a written request to be released and discharged. The 39 request shall not operate to relieve, release or discharge the surety from any 40 liability accrued, or which will accrue, before the expiration of the thirty 41 (30) day period. The commission shall promptly, upon receipt of the notice of 42 the request, notify the licensee and require him to furnish a new bond. Unless 43 the licensee files a new bond with the commission in the amount provided in 44 this section before the expiration of the thirty (30) day period, the commis- 45 sion shall immediately cancel the licensee's license. 46 (2) In the event that any taxes due under the provisions of this chapter 47 or chapter 48, title 63, Idaho Code, are not paid by a licensed distributor, 48 and the unpaid taxes are assessed by the commission, and after all avenues 49 for appeal of the assessment have been exhausted, the commission may apply the 50 unpaid tax liability against the bond required by this section. 51 SECTION 3. That Section 63-2431, Idaho Code, be, and the same is hereby 52 amended to read as follows: 3 1 63-2431. TAX IN LIEU OF ALL OTHER TAXES IMPOSED -- EXCEPTION. The taxes 2 imposed by this chapter shall be in lieu of all other excise taxes, license 3 fees or property taxes imposed upon gasoline, aircraft engine fuel or special 4 fuels by this state or any political subdivision of this state, except as pro- 5 vided in chapter 48, title 63, Idaho Code. 6 SECTION 4. That Title 63, Idaho Code, be, and the same is hereby amended 7 by the addition thereto of a NEW CHAPTER, to be known and designated as Chap- 8 ter 48, Title 63, Idaho Code, and to read as follows: 9 CHAPTER 48 10 HIGHWAY PRESERVATION FUEL TAX 11 63-4801. DEFINITIONS. As used in this chapter: 12 (1) "Commission" means the Idaho state tax commission. 13 (2) "Distributor" means any person who receives motor fuel in this state, 14 and includes a special fuels dealer. Any person who sells or receives gaseous 15 fuels shall not be considered a distributor unless the gaseous fuel is deliv- 16 ered into the fuel supply tank or tanks of a motor vehicle not then owned or 17 controlled by him. 18 (3) "Motor fuel" means gasoline, special fuels, aircraft engine fuels or 19 any other fuels suitable for the operation or propulsion of motor vehicles, 20 motor boats or aircraft. 21 (4) "Purchase price" means the price paid by the distributor for motor 22 fuel received by the distributor as specified in section 63-2403, Idaho Code. 23 63-4802. IMPOSITION OF HIGHWAY PRESERVATION FUEL TAX UPON MOTOR FUEL. (1) 24 A highway preservation fuel tax is hereby imposed upon gross purchases by a 25 distributor of motor fuel in this state at two percent (2%) of the purchase 26 price paid by the distributor. The tax shall be imposed without regard to 27 whether use is on a governmental basis or otherwise, unless exempted by the 28 provisions of this chapter. The tax imposed by this subsection (1) is an 29 excise tax, the legal incidence of which is imposed upon the distributor who 30 purchases the motor fuel. 31 (2) The tax shall be paid by distributors upon the distributor's receipt 32 of motor fuel in this state. 33 (3) The tax imposed in subsection (1) of this section does not apply to: 34 (a) Special fuels that have been dyed at a refinery or terminal under the 35 provisions of 26 U.S.C. section 4082 and regulations adopted thereunder, 36 or under the federal clean air act and regulations adopted thereunder 37 except as provided in section 63-2425, Idaho Code; or 38 (b) Special fuel dispensed into a motor vehicle which uses gaseous spe- 39 cial fuels and which displays a valid gaseous special fuels permit under 40 section 63-2424, Idaho Code; or 41 (c) Special fuels that are gaseous special fuels, as defined in section 42 63-2401, Idaho Code, except that part thereof that is delivered into the 43 fuel supply tank or tanks of a motor vehicle; or 44 (d) Aircraft engine fuel subject to tax under section 63-2408, Idaho 45 Code. 46 63-4803. PAYMENT OF TAX. The highway preservation fuel tax imposed by 47 section 63-4802, Idaho Code, shall be paid by the distributor, and is imposed 48 upon the purchase price paid on gross purchases of motor fuel by the distribu- 49 tor at the rate specified in section 63-4802, Idaho Code. The tax shall be 50 remitted with the distributor's monthly report as required in section 63-4805, 4 1 Idaho Code. 2 63-4804. DISTRIBUTION OF TAX REVENUES. (1) An amount of money equal to 3 the actual cost of collecting, administering and enforcing the highway preser- 4 vation fuel tax provisions by the commission, as determined by the commission, 5 shall be retained by the commission. The amount retained by the commission 6 shall not exceed the amount authorized to be expended by appropriation by the 7 legislature. Any unencumbered balance in excess of the actual cost of collect- 8 ing, administering and enforcing the highway preservation fuel tax by the com- 9 mission at the end of each fiscal year shall be distributed to the highway 10 distribution account. 11 (2) An amount of money shall be distributed to the state refund account 12 sufficient to pay current refund claims. All refunds authorized by the commis- 13 sion to be paid under this chapter shall be paid from the state refund 14 account. Such moneys are hereby continuously appropriated. 15 63-4805. DISTRIBUTOR REPORTS. (1) Each distributor shall, not later than 16 the last day of each calendar month or for such other reporting period as the 17 commission may authorize, render to the commission an accurate report of all 18 moneys paid for motor fuel received by him in this state during the preceding 19 reporting period. The report shall be made in the manner and on forms required 20 by the commission. 21 (2) The distributor's report shall include: 22 (a) An itemized statement of the total moneys paid for motor fuel 23 received during the preceding calendar month; and 24 (b) Other information as the commission may require for the proper admin- 25 istration of this chapter. 26 (3) The report shall be accompanied by a remittance of the tax shown to 27 be due on the report, together with applicable interest and penalty if any are 28 due, unless the amounts due are paid by electronic funds transfer in the man- 29 ner provided in section 67-2026, Idaho Code. 30 (4) Any distributor required to pay the tax imposed by this chapter who 31 fails to pay such tax shall be liable to the commission for the amount of tax 32 not remitted plus applicable interest or penalty. The commission shall assess 33 interest and collect penalties in accordance with the provisions of section 34 63-2434, Idaho Code. 35 63-4806. BONDING. (1) At the time an application for a distributor's 36 license, issued pursuant to section 63-2427A, Idaho Code, is submitted to the 37 commission, the applicant shall file a bond with the commission conditioned 38 upon faithful performance of all of the requirements of this chapter and as 39 required under section 63-2428, Idaho Code. 40 (2) In the event that any taxes due under the provisions of this chapter 41 are not paid by a licensed distributor, and the unpaid taxes are assessed by 42 the commission, and after all avenues for appeal of the assessment have been 43 exhausted, the commission may apply the unpaid tax liability against the bond 44 required by this section. 45 63-4807. REQUIRED RECORDS. (1) Every distributor and every special fuels 46 dealer and every person reporting, manufacturing, refining, dealing, trans- 47 porting or storing gasoline, aircraft engine fuel or special fuels in this 48 state shall keep records, receipts, invoices and other pertinent records as 49 the commission may require. Records required and all other relevant books and 50 records shall be available for inspection by the commission at all times dur- 51 ing regular recordkeeper's business hours. 5 1 (2) Records required in subsection (1) of this section shall be kept for 2 a period of three (3) years from the date on which the distributor's report or 3 special fuels dealer's return to which they relate was required to be filed 4 with the commission. 5 63-4808. REVOCATION OR CANCELLATION OF LICENSE. (1) The commission may 6 revoke the license of a distributor or a carrier licensed in Idaho under the 7 international fuel tax agreement (IFTA) in any of the following circumstances: 8 (a) The licensee refuses or neglects to comply with the provisions of 9 this chapter or rules of the commission promulgated pursuant to this chap- 10 ter; 11 (b) When, upon investigation, the commission ascertains or finds that the 12 person to whom the license was issued is no longer engaged in business as 13 a distributor or an Idaho IFTA carrier and has not been so engaged for a 14 period of six (6) months prior to the cancellation; or 15 (c) The licensee files a written request with the commission asking that 16 the license be canceled and the commission determines upon investigation 17 that the licensee is no longer a person required to be a licensed distrib- 18 utor or required to have an IFTA license. 19 (2) In the case of a cancellation under subsection (1)(c) of this sec- 20 tion, the cancellation shall not be effective nor shall the licensee's surety 21 be discharged from any bond unless the licensee has paid to the state of Idaho 22 all taxes imposed under this chapter, including all interest, penalties and 23 additional amounts that may have accrued. 24 (3) In the case of revocation of a license under subsection (1)(a) or 25 (1)(b) of this section, prior to revoking the license, the commission shall 26 give notice of the proposed revocation to the licensee in the manner provided 27 in section 63-3045, Idaho Code, which shall be subject to review as provided 28 in section 63-3045, Idaho Code. If a petition for redetermination of the 29 license revocation is not filed within the time period allowed, the determina- 30 tion shall become final as provided in section 63-3045B, Idaho Code. The state 31 tax commission shall not issue a new license after the revocation of a license 32 unless the commission is satisfied that the former holder of the license has 33 filed all returns and reported and paid all taxes, interest and penalties 34 required by this chapter, and such person has corrected any other violations 35 of this chapter upon which the revocation was based. 36 63-4809. DOING BUSINESS WITHOUT A LICENSE -- PENALTIES. Any person who 37 engages in the business as a distributor or a special fuels dealer without 38 being the holder of a valid license shall be guilty of a misdemeanor. Each day 39 of business without a valid license shall constitute a separate offense. 40 63-4810. ENFORCEMENT PROVISIONS. For the purpose of carrying out its 41 duties to enforce or administer the provisions of this chapter, the commission 42 shall have the powers and duties provided by sections 63-3038, 63-3039, 43 63-3042 through 63-3066, 63-3068, 63-3071, 63-3074 through 63-3078 and 44 63-217, Idaho Code, which sections are incorporated by reference herein as 45 though set out verbatim. 46 63-4811. EXCHANGE OF INFORMATION AGREEMENTS. (1) For the purpose of 47 administering the provisions of this chapter, the commission and the Idaho 48 transportation department may enter into such written agreements for the 49 exchange of information or delegation of authority or both as the commission 50 and the department may find necessary to properly implement the letter and 51 intent of the provisions of this chapter. 6 1 (2) The commission may enter into cooperative agreements as a part of or 2 in addition to any authorized by section 63-2442A, Idaho Code, and in accor- 3 dance with the provisions of that section for the administration and enforce- 4 ment of this chapter. 5 63-4812. ADMINISTRATION. The commission shall enforce the provisions of 6 this chapter and may prescribe, adopt, and enforce reasonable rules relating 7 to the administration and enforcement of these provisions. 8 63-4813. VIOLATIONS AND PENALTIES. (1) It shall be unlawful for any per- 9 son to: 10 (a) Refuse, or knowingly and intentionally fail to make and file any 11 statement required by this chapter in the manner or within the time 12 required; 13 (b) Willfully fail to pay any tax due or any fee required by this chapter 14 or any related penalties or interest; 15 (c) Knowingly and with intent to evade or to aid in the evasion of the 16 tax imposed by this chapter to make any false statement or conceal any 17 material fact in any record, return, or affidavit provided for in this 18 chapter; 19 (d) Conduct any activities requiring a license under this chapter without 20 a license or after a license has been surrendered, canceled or revoked; or 21 (e) Fail to keep and maintain the books and records required by this 22 chapter. 23 (2) It shall be unlawful for any retail dealer in motor fuel who is not a 24 licensed distributor or for any person in the state of Idaho other than a 25 licensed distributor to purchase, receive or accept any motor fuel upon which 26 tax imposed by this chapter has not been paid. 27 (3) It shall be unlawful for any person, including a licensed distribu- 28 tor, to sell or transfer any fuel upon which tax required by this chapter has 29 not been paid to any person unless such sale or transfer is authorized by this 30 chapter. 31 (4) Any person violating any provision specified in this section is 32 guilty of a misdemeanor, unless the act is by any other law of this state 33 declared to be a felony, and upon conviction is punishable by a fine of not 34 less than one hundred dollars ($100) nor more than one thousand dollars 35 ($1,000). 36 (5) The fine and imprisonment provided for in this section shall be in 37 addition to any other penalty imposed by any other provision of this chapter.
STATEMENT OF PURPOSE
RS 18152
This legislation relates to the Highway Preservation Fuel
Tax. It increases the annual fee for gaseous fuel permits,
and increases the amount required to be secured by a
distributor's bond. The legislation adds a new Chapter 48,
title 63, Idaho Code to provide definitions, to provide for
imposition of the Highway Preservation Fuel Tax, to provide
for payment and distribution of tax revenues.
FISCAL NOTE
The legislation will result in an increase of $48,000,000 to
the general fund. (The effect of increasing the annual fee
for gaseous fuel permits will be minimal.)
Contact
Name: Representative Shirley Ringo
Phone: 332-1032
Representative James Ruchti
Representative Phylis King
Representative Sue Chew
Representative Nicole LeFavour
Representative Bill Killen
STATEMENT OF PURPOSE/FISCAL IMPACT H 686