Part 1.
COMPTROLLER OF PUBLIC ACCOUNTS
Chapter 3.
TAX ADMINISTRATION
Subchapter S. MOTOR FUEL TAX
34 TAC §3.434
The Comptroller of Public Accounts proposes a new §3.434,
concerning liquefied gas tax decal. The rule was originally filed as new §3.744,
appearing in the May 28, 2004, issue of the
Texas
Register
(29 TexReg 5304), and is being re-filed to comply with Texas
Register requirements for numbering sequence. The new rule incorporates legislative
changes in House Bill 2458, 78th Legislature, 2003, to add Tax Code, Chapter
162, relating to motor fuel taxes and the repeal of Tax Code, Chapter 153.
The new rule provides a liquefied gas decal rate schedule, sets out exceptions
to liquefied gas tax, discusses the display of decals, and provides guidance
for refunds of prepaid liquefied gas tax.
James LeBas, Chief Revenue Estimator, has determined that for the first
five-year period the rule will be in effect, there will be no significant
revenue impact on the state or units of local government.
Mr. LeBas also has determined that for each year of the first five years
the rule is in effect, the public benefit anticipated as a result of enforcing
the rule will be in providing new information regarding tax responsibilities.
This rule is adopted under Tax Code, Title 2, and does not require a statement
of fiscal implications for small businesses. There is no significant anticipated
economic cost to individuals who are required to comply with the proposed
rule.
Comments on the proposal may be submitted to Bryant K. Lomax, Manager,
Tax Policy Division, P.O. Box 13528, Austin, Texas, 78711.
The new rule is proposed under Tax Code, §111.002, which
provides the comptroller with the authority to prescribe, adopt, and enforce
rules relating to the administration and enforcement of Tax Code, Title 2.
The new rule implements the Tax Code, §§162.302, 162.3021, 162.305,
162.307, 162.309, and 162.311.
§3.434.Liquefied Gas Tax Decal (Tax Code, §§162.302, 162.3021, 162.305, 162.307, 162.309, and 162.311).
(a)
Effective date. This rule applies only to motor fuel transactions
that take place on or after January 1, 2004. Motor fuel transactions that
occur prior to January 1, 2004, will be governed by sections in Texas Administrative
Code, Title 34, Part 1, Chapter 3, Subchapter L.
(b)
Use of decal. Except as provided in subsections (c), (d),
and (g) of this section, a person who operates a motor vehicle that is required
to be licensed in Texas for use on the public highways of Texas and that is
powered by natural gas, methane, ethane, propane, butane, or a mixture of
those gases, including a motor vehicle equipped to use liquefied gas interchangeably
with another motor fuel, must:
(1)
obtain from the comptroller a liquefied gas decal; and
(2)
prepay the liquefied gas tax to the comptroller on an annual
basis.
(c)
Motor Vehicle Dealer. A motor vehicle dealer registered
under Transportation Code, Chapter 503, must pay the liquefied gas tax to
a licensed liquefied gas dealer when the fuel is delivered into the fuel supply
tanks of each motor vehicle that display a motor vehicle dealer decal and
that is held for resale.
(d)
Interstate trucker. An interstate trucker registered under
a multistate tax agreement (International Fuel Tax Agreement), must pay the
liquefied gas tax to a licensed liquefied gas dealer when the fuel is delivered
into the fuel supply tanks of motor vehicles that have two axles and a registered
gross weight in excess of 26,000 pounds; have three or more axles, or are
used in combination and the registered gross weight of the combination exceeds
26,000 pounds, and that display current multistate tax agreement (International
Fuel Tax Agreement) decals.
(e)
Vehicle registered in another state. A liquefied gas tax
decal cannot be issued to a motor vehicle registered in a state other than
Texas. Owners of such vehicles must pay tax to a licensed liquefied gas dealer
on fuel delivered into the fuel supply tanks.
(f)
Application. Each person purchasing liquefied gas for use
in a liquefied gas powered motor vehicle must submit an annual application
to the comptroller for each vehicle.
(1)
Initial application. An applicant initially applying for
a liquefied gas tax decal for a Class A- F motor vehicle must purchase a decal
based on an estimate of miles that will be driven during the next one-year
period.
(2)
Renewal. The applicant must produce an ending odometer
reading on the renewal application. In the absence of an ending odometer reading,
the previous year's mileage will be presumed to be at least 15,000 miles.
Applications for the upcoming year should be submitted during the month of
expiration of the current decal.
(A)
The liquefied gas tax does not apply to miles traveled
outside the state. A record of miles traveled by the motor vehicle outside
Texas must be maintained and submitted with the renewal each year. The record
must include the date(s) of travel, beginning and ending odometer readings
and destination.
(B)
Special use vehicles. Vehicles required to be licensed
for highway use but whose main purpose, design, and use is off the highway
may renew a liquefied gas decal for a rate less than the mileage indicated
on the odometer if a record or log indicating the miles traveled on the highway
by the vehicle is maintained and attached to the renewal application.
(g)
Exceptions.
(1)
School district transportation and county exceptions. The
liquefied gas tax does not apply to liquefied gas sold to public school districts
and counties in this state, or to commercial transportation companies providing
transportation services to public school districts in this state. These transportation
companies must obtain letters of exception from the comptroller, as discussed
in §3.448 of this title (relating to Transportation Services for Texas
Public School Districts).
(2)
Decal not required. A public school district, a commercial
transportation company providing transportation services to a public school
district and holding a valid letter of exception from the comptroller, or
a county in this state operating a motor vehicle powered by liquefied gas
is not required to prepay the liquefied gas tax and obtain a decal for the
motor vehicle.
(h)
Rate schedule.
(1)
The following rate schedule (based on mileage driven the
previous year) applies.
(2)
Transit company. A special use liquefied gas tax decal
and tax is required for the following type of vehicles: Class T: Transit carrier
vehicles operated by a transit company, $444.
(i)
Display of decal. The decal shall be affixed to the inside,
lower right corner of the windshield (passenger side) of the vehicle. An
expired or invalid liquefied gas tax decals shall be removed before installing
a new decal or transferring ownership of the motor vehicle.
(j)
Refunds; transfer of decal. If a motor vehicle bearing
a liquefied gas tax decal is sold, transferred, destroyed, or the liquefied
gas carburetor system (regulator or fuel supply tank) is removed from the
motor vehicle the owner is entitled to a refund of the unused portion of the
advanced taxes paid for the decal year. The owner must submit to the comptroller
the liquefied gas tax decal with an affidavit identifying the motor vehicle
and circumstances for requesting a refund. The comptroller shall refund that
portion of the tax payment that corresponds to the number of complete months
remaining in the decal year.
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of
the Secretary of State on June 15, 2004.
TRD-200403883
Martin Cherry
Chief Deputy General Counsel
Comptroller of Public Accounts
Earliest possible date of adoption: August 1, 2004
For further information, please call: (512) 475-0387
34 TAC §3.437
The Comptroller of Public Accounts proposes a new §3.437,
concerning trip permit in lieu of interstate trucker license. The rule was
originally filed as new §3.747, appearing in the May 28, 2004, issue
of the
Texas Register
(29 TexReg 5304), and
is being re-filed to comply with Texas Register requirements for numbering
sequence. The new rule incorporates legislative changes in House Bill 2458,
78th Legislature, 2003, to add Tax Code, Chapter 162, relating to motor fuel
taxes and the repeal of Tax Code, Chapter 153. The new rule provides qualification
for a trip permit, conditions for trip permit use, procedures for obtaining
trip permit, and limitations on the use of trip permits.
James LeBas, Chief Revenue Estimator, has determined that for the first
five-year period the rule will be in effect, there will be no significant
revenue impact on the state or units of local government.
Mr. LeBas also has determined that for each year of the first five years
the rule is in effect, the public benefit anticipated as a result of enforcing
the rule will be in providing new information regarding tax responsibilities.
This rule is adopted under Tax Code, Title 2, and does not require a statement
of fiscal implications for small businesses. There is no significant anticipated
economic cost to individuals who are required to comply with the proposed
rule.
Comments on the proposal may be submitted to Bryant K. Lomax, Manager,
Tax Policy Division, P.O. Box 13528, Austin, Texas, 78711.
The new rule is proposed under Tax Code, §111.002, which
provides the comptroller with the authority to prescribe, adopt, and enforce
rules relating to the administration and enforcement of the Tax Code, Title
2.
The new rule implements Tax Code, §§162.003, 162.106, 162.110,
162.207, and 162.211.
§3.437.Trip Permit in Lieu of Interstate Trucker License (Tax Code, §§162.003, 162.106, 162.110, 162.207, and 162.211).
(a)
This rule applies only to motor fuel transactions that
take place on or after January 1, 2004. Motor fuel transactions that occur
prior to January 1, 2004, will be governed by sections in Texas Administrative
Code, Title 34, Part 1, Chapter 3, Subchapter L.
(b)
Who may qualify. A person entering Texas for commercial
purposes with a motor vehicle that has two axles and a registered gross weight
in excess of 26,000 pounds; or has three or more axles, or is used in combination
and the registered gross weight of the combination exceeds 26,000 pounds,
may purchase a temporary trip permit in lieu of the required interstate trucker
license or registration under a multistate tax agreement (International Fuel
Tax Agreement) if no more than five entries into the state are made during
a calendar year.
(c)
Conditions.
(1)
A trip permit must be obtained before or at the time of
entry into Texas.
(2)
The trip permit is valid for 20 days from date of purchase.
(3)
The trip permit may be used for only one entry into the
state.
(d)
Procedures.
(1)
A fee of $50 for the trip permit shall be paid to the Texas
comptroller.
(2)
The fee may be paid in the form of a cashier's check or
a money order delivered by mail or wire service to the Texas comptroller's
office, Austin.
(3)
The receipt from the cashier's check or money order shall
be marked "trip permit" and, identify the motor vehicle by license plate number
or the manufacture's vehicle identification number.
(4)
The receipt must be carried in the vehicle for which the
tax payment is made.
(e)
Limitations. Persons who make more than five entries in
a calendar year must obtain an interstate trucker license or register under
a multistate tax agreement (International Fuel Tax Agreement).
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of
the Secretary of State on June 15, 2004.
TRD-200403884
Martin Cherry
Chief Deputy General Counsel
Comptroller of Public Accounts
Earliest possible date of adoption: August 1, 2004
For further information, please call: (512) 475-0387
34 TAC §3.438
The Comptroller of Public Accounts proposes a new §3.438,
concerning signed statements for purchasing dyed diesel fuel tax free. The
rule was originally filed as new §3.748, appearing in the May 28, 2004,
issue of the
Texas Register
(29 TexReg 5304),
and is being re-filed to comply with Texas Register requirements for numbering
sequence. The new rule incorporates legislative changes in House Bill 2458,
78th Legislature, 2003, to add Tax Code, Chapter 162, relating to motor fuel
taxes and the repeal of Tax Code, Chapter 153. The new rule provides registration
for end user numbers, sets out the content of a signed statement, and describes
the limitations on the use of signed statements.
James LeBas, Chief Revenue Estimator, has determined that for the first
five-year period the rule will be in effect, there will be no significant
revenue impact on the state or units of local government.
Mr. LeBas also has determined that for each year of the first five years
the rule is in effect, the public benefit anticipated as a result of enforcing
the rule will be in providing new information regarding tax responsibilities.
This rule is adopted under Tax Code, Title 2, and does not require a statement
of fiscal implications for small businesses. There is no significant anticipated
economic cost to individuals who are required to comply with the proposed
rule.
Comments on the proposal may be submitted to Bryant K. Lomax, Manager,
Tax Policy Division, P.O. Box 13528, Austin, Texas, 78711.
The new rule is proposed under Tax Code, §111.002, which
provides the comptroller with the authority to prescribe, adopt, and enforce
rules relating to the administration and enforcement of Tax Code, Title 2.
The new rule implements Tax Code, §162.206.
§3.438.Signed Statements for Purchasing Dyed Diesel Fuel Tax Free (Tax Code, §162.206).
(a)
This rule applies only to motor fuel transactions that
take place on or after January 1, 2004. Motor fuel transactions that occur
prior to January 1, 2004, will be governed by sections in Texas Administrative
Code, Title 34, Part 1, Chapter 3, Subchapter L.
(b)
End User Number. A person who wants to use a signed statement
to purchase dyed diesel fuel tax free for use in nonhighway equipment must
apply to the comptroller for an End User Number. The comptroller will issue
to a qualified applicant an End User Number with a prefix of DD (for non-agriculture
off road equipment) or AG (for agriculture off road equipment) depending on
the manner in which the applicant will use the dyed diesel fuel. A person
cannot use a signed statement to purchase tax-free dyed diesel fuel unless
the person holds an End User Number issued by the comptroller.
(c)
Signed Statement. A person with a valid End User Number
may purchase dyed diesel fuel tax free for nonhighway use by providing the
seller with a signed statement subject to the limitations that are stated
in paragraphs (2), (3) and (4) of this subsection. Copies of the blank signed
statements are available for inspection at the office of the Texas Register.
Copies may be obtained from the Comptroller of Public Accounts, P.O. Box 13528,
Austin, Texas 78711-3528 or requested by calling 512/463-4600, or our toll-free
number 1-800-252-1383. (From a Telecommunication Device for the Deaf (TDD)
only, call 512/463-4621 or 1-800-248-4099 toll free) Taxpayers may download
copies at www.window.state.tx.us.
(1)
The signed statement must include the purchaser's End User
Number, must be signed by the buyer or the buyer's authorized representative,
and must specify that:
(A)
only dyed diesel fuel will be purchased using the signed
statement;
(B)
all dyed diesel fuel will be used by the buyer and will
not be resold; and
(C)
none of the dyed diesel fuel will be delivered into the
fuel supply tanks of motor vehicles operated on public highways.
(2)
A person issued an End User Number beginning with DD may
buy, and a licensed diesel fuel supplier, permissive supplier, or distributor
may sell, dyed diesel fuel tax free using a signed statement subject to the
following limitations:
(A)
not more than 7,400 gallons of dyed diesel fuel may be
purchased or sold in a single delivery; or
(B)
not more that 10,000 gallons of dyed diesel fuel may be
purchased or sold to a purchaser during a month. The purchase, sale, or delivery
that causes the 10,000 gallon limit to be exceeded during a month is not taxable.
Any subsequent purchase, sale, or delivery made during the same month is taxable.
(3)
A person who has been issued an end user number beginning
with DD and who uses the dyed diesel fuel exclusively in the original production
of oil and gas, or to increase the production of oil and gas, must obtain
a letter of exception authorizing the person to exceed the 10,000 gallon limit.
Examples of uses that may occur in the original production or to increase
production of oil and gas include the use of dyed diesel fuel to drill, fracture,
perforate, squeeze cement, acidize, log, plug back, complete, plug and abandon,
install a casing liner, pull or reset a casing liner, swab, drill out a plug,
jet, pack gravel or workover, and perform a hot oil treatment on a formation.
Oil and gas production does not include maintaining the site, mowing, painting,
gauging tanks, changing pumps, performing rod or tubing jobs, fishing for
rods or tubing, repairing a tubing leak, changing a packer or anchor, performing
hot oil or water treatment on casing, tubing or flow lines, and transporting.
A person who uses dyed diesel fuel exclusively in the original production
of oil and gas or to increase the production of oil and gas, may buy, and
a licensed diesel fuel supplier, permissive supplier, or distributor may sell,
dyed diesel fuel tax free by using a letter of exception and a signed statement,
subject to the following limitations:
(A)
not more than 7,400 gallons of dyed diesel fuel may be
purchased or sold in a single delivery; or
(B)
not more than 25,000 gallons of dyed diesel fuel may be
purchased or sold to a purchaser during a calendar month. The purchase, sale,
or delivery that causes the 25,000 gallon limit to be exceeded during a calendar
month is not taxable. Any subsequent purchase, sale, or delivery made during
the same calendar month is taxable.
(4)
A person who has been issued an end user number beginning
with AG and who uses dyed diesel fuel exclusively for an agricultural purpose
as described in Tax Code, §162.001, may buy, and a diesel fuel licensed
supplier, permissive supplier, or distributor may sell, dyed diesel fuel tax
free using a signed statement subject to the following limitations:
(A)
not more that 7,400 gallons of dyed diesel fuel may be
purchased or sold in a single delivery; or
(B)
not more than 25,000 gallons of dyed diesel fuel may be
purchased or sold to an end user during a calendar month. The purchase, sale,
or delivery that causes the 25,000 gallon limit to be exceeded during a calendar
month is not taxable. Any subsequent purchase, sale, or delivery made during
the same calendar month is taxable.
Figure: 34 TAC §3.438(c)(4)(B)
(d)
A person who exceeds the limitations in subsection (c)
of this section shall be required to obtain a dyed diesel fuel bonded user
license.
(e)
A separate operating division of a corporation may apply
for and receive an End User Number to buy dyed diesel fuel tax free using
a signed statement if the division:
(1)
does not resell the fuel;
(2)
consumes the fuel; and
(3)
maintains separate storage apart from other corporate divisions.
(f)
The signed statement remains in effect until:
(1)
it is revoked in writing by either the buyer or seller;
or
(2)
the comptroller notifies the supplier or distributor in
writing or by means of electronic transmission that the buyer may no longer
make tax-free purchases.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Filed with the Office of
the Secretary of State on June 15, 2004.
TRD-200403885
Martin Cherry
Chief Deputy General Counsel
Comptroller of Public Accounts
Earliest possible date of adoption: August 1, 2004
For further information, please call: (512) 475-0387