Bill Text: AZ HB2493 | 2016 | Fifty-second Legislature 2nd Regular | Introduced
Bill Title: Use fuel taxes; adjustment
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2016-03-21 - House majority caucus: Do pass [HB2493 Detail]
Download: Arizona-2016-HB2493-Introduced.html
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REFERENCE TITLE: use fuel taxes; adjustment |
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State of Arizona House of Representatives Fifty-second Legislature Second Regular Session 2016
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HB 2493 |
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Introduced by Representatives Bowers: Shope
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AN ACT
amending sections 28‑2356, 28-5601 and 28-5603, Arizona Revised Statutes; repealing section 28-5605, Arizona Revised Statutes, as added by Laws 2001, chapter 287, section 13; repealing section 28-5605, Arizona Revised Statutes, as amended by Laws 2015, chapter 244, section 29; amending sections 28-5606, 28‑5610, 28-5612, 28-5613, 28-5614 and 28-5615, Arizona Revised Statutes; repealing section 28-5617, Arizona Revised Statutes; amending sections 28‑5619 and 28-5620, Arizona Revised Statutes; repealing section 28-5623, Arizona Revised Statutes; amending sections 28-5626, 28-5638 and 28-5731, Arizona Revised Statutes; relating to motor fuel taxes.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 28-2356, Arizona Revised Statutes, is amended to read:
28-2356. Transfer of license plates to another vehicle; credit; refund
A. Except as otherwise provided in this chapter, the owner of a vehicle for which the department provided license plates pursuant to section 28‑2351 shall retain those license plates when the owner transfers the vehicle to another person.
B. The owner may apply for a refund or a credit of the unexpired portion of the fees and taxes as prescribed in this section if both of the following apply:
1. The owner makes proper application to the director or to an authorized third party pursuant to chapter 13 of this title.
2. The owner agrees to allow the department to deduct a twelve dollar processing fee from the amount of the refund or credit.
C. If the owner applies for a credit as prescribed in this section, the department may assign the license plates retained pursuant to subsection A of this section to another vehicle that belongs to the owner if all of the following apply:
1. The other vehicle is of the same vehicle type.
2. The owner is applying the available credit for the fees and taxes to one other vehicle the owner owns or acquires.
3. If the available credit exceeds the amount required to pay the fees and taxes, the department shall issue issues a refund for the remaining amount of credit as prescribed in this section. The department shall not charge an additional twelve dollar fee pursuant to subsection B of this section for issuing a refund under this paragraph.
4. If the vehicle license tax, gross weight fees, commercial registration fees, special plate fees and motor carrier fees are more than the similar fees and taxes required to register the vehicle to which the license plates were previously assigned, the owner pays any additional fees and taxes required after subtracting any credit allowed under this section.
D. If the other vehicle is not of the same vehicle type as the vehicle for which the license plates were provided by the department pursuant to section 28‑2351, the owner shall either surrender the license plates to the department or an authorized third party or submit an affidavit of license plate destruction as prescribed by the director. On surrender of the license plates or submission of an affidavit of license plate destruction, the department shall provide new license plates of the proper vehicle type to the owner and credit the owner with an amount equal to the unexpended portion of the fees and taxes originally paid by the owner for registration and license plates toward fees and taxes charged for the registration and license plates of the appropriate new vehicle type.
E. The owner of a registered vehicle who transfers license plates to another vehicle or who claims a refund pursuant to this section is entitled to a credit or a refund for the unexpired portion of the fees and taxes paid as required by law in accordance with the following conditions:
1. The fees and taxes are prorated on a monthly basis beginning on the first day of the registration month following the date of acquisition of the vehicle.
2. The credit or refund shall be an amount computed as follows:
(a) If the vehicle is registered on an annual basis, one‑twelfth for each full month of the registration period not yet expired.
(b) If the vehicle is registered on a biennial basis pursuant to section 28‑2159, one‑twenty‑fourth for each full month of the registration period not yet expired.
(c) If the vehicle is permanently registered, one‑twenty‑fourth for each full month after acquisition of the vehicle to the twenty‑fourth month after the date of initial permanent registration of the vehicle.
3. The department deducts from the refund or credit the computed amount that is prescribed by section 28-5606, subsection D from the use fuel tax adjustment that is associated with each full month of the registration period not yet expired.
F. If the owner of a registered vehicle transfers the vehicle to another person but does not transfer the license plates to another vehicle, surrender the license plates to the department or an authorized third party or submit an affidavit of license plate destruction within thirty days of the transfer as required by section 28‑2058, the unexpired portion of the fees and taxes shall decrement decrease pursuant to subsection D e of this section until the owner either surrenders the license plates to the department or an authorized third party or submits an affidavit of license plate destruction.
G. Except as provided in subsection C of this section, an owner of a registered vehicle who transfers the vehicle to another person and either surrenders the license plates to the department or an authorized third party or submits an affidavit of license plate destruction may apply to the department for a refund of the unexpired portion of the fees and taxes paid if the owner does not claim a credit pursuant to this section and the refundable amount calculated pursuant to subsection D of this section exceeds the twelve dollar fee prescribed in subsection B of this section. If the department determines that the owner is entitled to a refund, the department shall send the refund by first class mail to the address provided by the owner claiming the refund or, if no address is provided, to the latest address listed on the department's records for the owner claiming the refund.
H. An owner who transfers license plates to another vehicle pursuant to this section is subject to the same penalties for the use of the license plates on another vehicle or for improper use of the license plates as the owner would have been subject to for use of the license plates on the vehicle to which the plates were previously assigned.
I. The owner of a vehicle registered in this state is not entitled to a credit or a refund pursuant to this section if the vehicle is registered in another state unless the owner is applying the credit pursuant to this section to another vehicle the owner owns or acquires for registration in this state.
J. The director shall adopt rules necessary to administer this section.
Sec. 2. Section 28-5601, Arizona Revised Statutes, is amended to read:
28-5601. Definitions
In this article and articles 2 and 5 of this chapter, unless the context otherwise requires:
1. "Blending":
(a) Means the mixing of one or more products, regardless of the original character of the product blended, if the product obtained by the blending is capable of use or otherwise sold for use in the generation of power for the propulsion of a motor vehicle, aircraft or watercraft.
(b) Does not include blending that occurs in the process of refining by the original refiner of crude petroleum or the blending of products known as lubricating oil and greases.
2. "Bulk end user" means a person who receives into the person's own storage facilities in transport truck lots motor fuel for the person's own consumption.
3. "Bulk plant" means a motor fuel storage and distribution facility that is not a terminal and from which motor fuel may be removed at a rack.
4. "Bulk transfer" means any transfer of motor fuel from one location to another by pipeline tender or marine delivery within the bulk transfer terminal system.
5. "Bulk transfer terminal system" means the motor fuel distribution system consisting of refineries, pipelines, marine vessels and terminals. Motor fuel in a refinery, pipeline, vessel or terminal is in the bulk transfer terminal system. Motor fuel in the fuel supply tank of any engine, or in any tank car, rail car, trailer, truck or other equipment suitable for ground transportation, is not in the bulk transfer terminal system.
6. "Consumer" means the end purchaser of motor vehicle fuel for use on the highways in this state, the end purchaser of motor vehicle fuel for use in watercraft on waterways of this state or the end purchaser of aviation fuel for use in aircraft.
7. "Destination state" means the state, territory or foreign country to which motor fuel is directed for delivery into a storage facility, a receptacle, a container or a type of transportation equipment for the purpose of resale or use.
8. "Distributor" means a person who acquires motor fuel from a supplier or another distributor for subsequent sale or use and who may blend or import into or export from this state motor fuel in the original package or container or otherwise but excluding a person who imports motor fuel in the fuel tank of a motor vehicle or aircraft.
9. "Dyed diesel fuel" means diesel fuel that is dyed pursuant to United States internal revenue service regulations or requirements, including any invisible marker requirements.
10. "Fuel tank" means a receptacle on a motor vehicle, watercraft or aircraft from which fuel is supplied for the propulsion of the motor vehicle, watercraft or aircraft, excluding a cargo tank but including a separate compartment of a cargo tank used as a fuel tank and an auxiliary tank or receptacle of any kind from which fuel is supplied for the propulsion of the motor vehicle, watercraft or aircraft, whether or not the tank or receptacle is directly connected to the fuel supply line of the motor vehicle, watercraft or aircraft.
11. "Highway" means any way or place in this state of whatever nature that is maintained by public monies and that is open to the use of the public for purposes of vehicular travel, including a highway under construction.
12. "In this state" means any way or place within the exterior limits of the state of Arizona that is maintained by public monies, including any such way or place that is owned by or ceded to the United States of America.
13. "Indian reservation" means all lands that are within the limits of areas set aside by the United States for the exclusive use and occupancy of Indian tribes by treaty, law or executive order and that are currently recognized as Indian reservations by the United States department of the interior.
14. "Indian tribe" means any organized nation, tribe, band or community recognized as an Indian tribe by the United States department of the interior.
15. "Interstate user" means a person registering a use class motor vehicle under chapter 7, article 7 or 8 of this title or section 28‑2321 or 28‑2324.
16. "Invoiced gallons" means the gallons actually billed on an invoice in payment to a supplier.
17. "Light class motor vehicle" means a motor vehicle that uses use fuel on the highways in this state but excludes a road tractor, truck tractor, truck or passenger carrying vehicle having a declared gross vehicle weight of more than twenty‑six thousand pounds or having more than two axles.
18. "Motor fuel" means motor vehicle fuel, use fuel and aviation fuel.
19. "Motor vehicle" means a self‑propelled vehicle required to be licensed or subject to licensing for operation on a highway.
20. "Permissive supplier" means an out‑of‑state supplier that elects, but is not required, to have a supplier's license pursuant to this article.
21. "Person" means an individual, firm, partnership, joint venture, association, corporation, estate, trust, business trust, receiver or syndicate, this state, any county, city, town, district or other subdivision of this state, an Indian tribe, or any other group or combination acting as a unit.
22. "Position holder":
(a) Means the person who holds the inventory position in motor fuel in a terminal, as reflected on the records of the terminal operator. For the purposes of this subdivision, "a person who holds the inventory position in motor fuel" means a person who has a contract with the terminal operator for the use of storage facilities and terminaling services for fuel at the terminal.
(b) Includes a terminal operator who owns fuel in the terminal.
23. "Public monies" means those monies that are received by this state and that are derived all or in part from tax revenues or other funding sources.
24. "Qualified terminal" means a terminal that is designated as a qualified terminal pursuant to the United States internal revenue code, regulation and practices and that has been assigned a terminal control number by the United States internal revenue service.
25. "Rack" means a mechanism for delivering motor fuel from a refinery, a terminal or a bulk plant into a railroad tank car, a transport truck or other means of transfer that is outside the bulk transfer terminal system.
26. "Refiner" means any person who owns, operates or otherwise controls a refinery within the United States.
27. "Refinery" means a facility that is used to produce motor fuel from crude oil, unfinished oils, natural gas liquids, transmix or other hydrocarbons or by blending and from which motor fuel may be removed by pipeline, by vessel or at a rack.
28. "Road tractor" means a motor vehicle that is designed and used for drawing other vehicles and that is not constructed to carry either a load independently or any part of the weight of a vehicle or load so drawn.
29. "Sell" includes a transfer of title or possession, exchange or barter in any manner or by any means.
30. "Supplier":
(a) Means a person who is registered pursuant to section 4101 of the United States internal revenue code for transactions in motor fuels in the bulk transfer terminal distribution system and who is one of the following:
(i) The position holder in a terminal or refinery in this state.
(ii) A person who imports motor fuel into this state from a foreign country.
(iii) A person who acquires motor fuel from a terminal or refinery in this state from a position holder pursuant to a two party exchange.
(iv) The position holder in a terminal or refinery outside this state with respect to motor fuel that that person imports into this state on the account of that person.
(b) Includes a permissive supplier unless specifically provided otherwise. Supplier does not include a terminal operator merely because the terminal operator handles motor fuel consigned to the terminal operator within a terminal.
31. "Terminal" means a storage and distribution facility for motor fuel, which is supplied by pipeline or marine vessel, that is registered as a qualified terminal by the United States internal revenue service and from which motor fuel may be removed at a rack.
32. "Terminal bulk transfer" includes the following:
(a) A marine barge movement of motor fuel from a refinery or terminal to a terminal.
(b) Pipeline movements of motor fuel from a refinery or terminal to a terminal.
33. "Terminal operator" means any person who owns, operates or otherwise controls a terminal and who does not use a substantial portion of the motor fuel that is transferred through or stored in the terminal for the person's own use or consumption or in the manufacture of products other than motor fuel. A terminal operator may own the motor fuel that is transferred through or stored in the terminal.
34. "Transmix" means the buffer or interface between two different products in a pipeline shipment or a mix of two different products within a refinery or terminal that results in an off‑grade mixture that is not usable or salable as motor fuel.
35. "Two party exchange" means a transaction:
(a) In which motor fuel is transferred from one licensed supplier or licensed permissive supplier to another licensed supplier or licensed permissive supplier.
(b) That includes a transfer from the person that holds the original inventory position for motor fuel in the terminal as reflected on the records of the terminal operator.
(c) That is simultaneous with removal from the terminal by the receiving exchange party.
(d) In which the terminal operator in the terminal operator's books and records treats the receiving exchange party as the supplier that removes the product across a terminal rack for purposes of reporting the events to the department.
36. "Use" includes the placing of fuel into any receptacle on a motor vehicle from which fuel is supplied for the propulsion of the vehicle unless the operator of the vehicle establishes to the satisfaction of the director that the fuel was consumed for a purpose other than to propel a motor vehicle on a highway in this state and, with respect to fuel brought into this state in any such receptacle on a use class motor vehicle, the consumption of the fuel in this state. A person who places fuel in a receptacle on a use class motor vehicle of another is not deemed to have used the fuel.
37. "Use class motor vehicle" means a motor vehicle that uses use fuel on a highway in this state and that is a road tractor, truck tractor, truck or passenger carrying vehicle having a declared gross vehicle weight of more than twenty‑six thousand pounds or having more than two axles.
38. "Use fuel" includes all gases and liquids used or suitable for use to propel motor vehicles, except fuels that are subject to the motor vehicle fuel tax imposed by this article.
39. "User" includes a person who, within the meaning of the term use as defined in this section, uses fuel in a use class motor vehicle.
40. "Vendor" includes a person who sells use fuel in this state and who places the fuel or causes the fuel to be placed into any receptacle on a motor vehicle from which receptacle fuel is supplied for the propulsion, including a service station dealer, a broker and a user who sells use fuel to others.
Sec. 3. Section 28-5603, Arizona Revised Statutes, is amended to read:
28-5603. Motor fuel testing
A. The director may take samples of any liquid believed to be motor fuel and may make or cause to be made an analysis of the liquid.
B. The chemistry department or other qualified department of the university of Arizona shall:
1. Analyze samples on request of the director.
2. Promptly furnish to the director a full report of the analysis without cost.
Sec. 4. Repeal
A. Section 28-5605, Arizona Revised Statutes, as added by Laws 2001, chapter 287, section 13 is repealed.
B. Section 28-5605, Arizona Revised Statutes, as amended by Laws 2015, chapter 244, section 29 is repealed.
Sec. 5. Section 28-5606, Arizona Revised Statutes, is amended to read:
28-5606. Imposition of motor fuel taxes; use fuel tax adjustment
A. In addition to all other taxes provided by law, a motor vehicle fuel tax of eighteen cents per gallon is imposed on motor vehicle fuel possessed, used or consumed in this state.
B. To partially compensate this state for the use of its highways:
1. A use fuel tax is imposed on use fuel used in the propulsion of a light class motor vehicle on a highway in this state at the same rate per gallon as the motor vehicle fuel tax prescribed in subsection A of this section, except that there is no use fuel tax on alternative fuels.
2. 1. A use fuel tax is imposed on use fuel used in the propulsion of a use class motor vehicle or a light class motor vehicle on a highway in this state at the rate of twenty‑six cents for each gallon, except that there is no use fuel tax on alternative fuels and use class vehicles that are exempt pursuant to section 28‑5432 from the weight fee prescribed in section 28‑5433 are subject to the use fuel tax imposed by paragraph 1 of this subsection.
3. 2. Through December 31, 2024, a use fuel tax is imposed on use fuel used in the propulsion of a motor vehicle transporting forest products in compliance with the requirements of section 41-1516 on a highway in this state at the rate of nine cents for each gallon, except that there is no use fuel tax on alternative fuels.
C. The owner of a light class motor vehicle that is propelled by use fuel or of a use class motor vehicle that is propelled by use fuel and that is exempt pursuant to section 28-5432 from the weight fee prescribed in section 28-5433 is eligible at the time of vehicle registration to collect a use fuel tax adjustment of seventy dollars per registration year.
D. If an owner of a vehicle described in subsection C of this section requests a refund as prescribed in section 28-2356, the department shall deduct from the refund the computed amount as follows:
1. If the vehicle is registered for a one year registration period pursuant to section 28-2159, one-twelfth for each full month of the registration period not yet expired.
2. If the vehicle is registered for a two year registration period pursuant to section 28-2159, one-twenty-fourth for each full month of the registration period not yet expired.
3. If the vehicle is registered for a five year registration period pursuant to section 28-2159, one-sixtieth for each full month of the registration period not yet expired.
C. E. The motor vehicle fuel and use fuel taxes imposed pursuant to this section and the aviation fuel taxes imposed pursuant to section 28‑8344 are conclusively presumed to be direct taxes on the consumer or user but shall be collected and remitted to the department by suppliers for the purpose of convenience and facility only. Motor vehicle fuel, use fuel and aviation fuel taxes that are collected and paid to the department by a supplier are considered to be advance payments, shall be added to the price of motor vehicle fuel, use fuel or aviation fuel and shall be recovered from the consumer or user.
D. F. Motor vehicle fuel and use fuel taxes imposed pursuant to this section on the use of motor vehicle fuel and use fuel and the aviation fuel taxes imposed pursuant to section 28‑8344 on the use of aviation fuel, other than by bulk transfer, arise at the time the motor vehicle, use or aviation fuel either:
1. Is imported into this state and is measured by invoiced gallons received outside this state at a refinery, terminal or bulk plant for delivery to a destination in this state.
2. Is removed, as measured by invoiced gallons, from the bulk transfer terminal system or from a qualified terminal in this state.
3. Is removed, as measured by invoiced gallons, from the bulk transfer terminal system or from a qualified terminal or refinery outside this state for delivery to a destination in this state as represented on the shipping papers if a supplier imports the motor vehicle, use or aviation fuel for the account of the supplier or the supplier has made a tax precollection election pursuant to section 28‑5636.
E. G. If motor fuel is removed from the bulk transfer terminal system or from a qualified terminal or is imported into this state, the original removal, transfer or importation of the motor fuel is subject to the collection of the tax. If this motor fuel is transported to another qualified terminal or reenters the bulk transfer terminal system, the subsequent sale of the motor fuel on which tax has been collected is not subject to collection of an additional tax if proper documentation is retained to support the transaction.
Sec. 6. Section 28-5610, Arizona Revised Statutes, is amended to read:
28-5610. Exemptions
A. The following are exempt from motor vehicle fuel and use fuel taxes imposed by section 28‑5606 and aviation fuel taxes imposed by section 28‑8344:
1. Motor fuel for which proof of export is available in the form of a terminal‑issued destination state shipping paper or bill of lading and that is either:
(a) Exported by a supplier who is licensed in the destination state.
(b) Sold by a supplier to a distributor for immediate export.
2. Motor fuel that was acquired by a distributor, as to which the tax imposed by this article or section 28‑8344 has previously been paid or accrued and that was subsequently exported by transport truck by or on behalf of the distributor in a diversion across state boundaries properly reported to the department. If diverted by a distributor, the distributor shall perfect the exemption by filing a refund application with the department within six months after the diversion.
3. Motor vehicle fuel or use fuel that is sold within an Indian reservation to an enrolled member of the Indian tribe who is living on the Indian reservation established for the benefit of that Indian tribe and that is used by the enrolled member for the enrolled member's own benefit. This exemption does not apply to sales within an Indian reservation by an Indian or Indian tribe to non‑Indian consumers or to Indian consumers who are not members of the Indian tribe for which the Indian reservation was established or to use fuel used to operate motor vehicles for a commercial purpose outside of the reservation on highways in this state. For the purposes of this paragraph, "Indian" means an individual who is registered on the tribal rolls of the Indian tribe for whose benefit the Indian reservation was created.
4. Motor vehicle fuel or use fuel used solely and exclusively as fuel to operate a motor vehicle on highways in this state if the motor vehicle is leased to or owned by and is being operated for the sole benefit of an Indian tribe for governmental purposes only.
5. Motor fuel that is moving in interstate or foreign commerce and that is not destined or diverted to a point in this state.
6. Motor vehicle or aviation fuel that is sold to the United States or an instrumentality or agency of the United States.
7. Taxable use fuel that has been accidentally contaminated so as to be unsalable as highway fuel as proved by proper documentation.
8. Dyed diesel fuel, including fuel used by either of the following:
(a) A farm tractor or implement of husbandry designed primarily for or used in agricultural operations and only incidentally operated or moved on a highway.
(b) A road roller or vehicle that is all of the following:
(i) Designed and used primarily for grading, paving, earthmoving or other construction work on a highway.
(ii) Not designed or used primarily for transportation of persons or property.
(iii) Incidentally operated or moved over the highway.
B. A use class vehicle shall pay the use fuel tax for light class motor vehicles prescribed by section 28-5606, subsection B, paragraph 1 if the vehicle is a truck and satisfies all of the following:
1. Is at least twenty-five years old.
2. Has been issued a historic vehicle license plate pursuant to section 28-2484.
3. Is not used as a commercial vehicle.
C. B. Notwithstanding subsection A, paragraph 8 of this section, the following are not exempt from use fuel taxes imposed by section 28‑5606:
1. A vehicle that was originally designed for the transportation of persons or property and to which machinery is attached or on which machinery or other property may be transported.
2. A dump truck.
3. A truck mounted transit mixer.
4. A truck or trailer mounted crane.
5. A truck or trailer mounted shovel.
D. C. Except as provided in subsection E D of this section, a person who claims an exemption pursuant to this section shall perfect the exemption by claiming a refund pursuant to section 28‑5612.
E. D. Subject to sections 28‑5645 through 28‑5649, dyed diesel fuel is exempt from use fuel taxes at the time of sale.
Sec. 7. Section 28-5612, Arizona Revised Statutes, is amended to read:
28-5612. Refund procedure; violation
A. A person who is seeking a refund and who is not licensed as a supplier, interstate user, or restricted distributor or use fuel vendor shall:
1. File an application with the director within six months after the date of sale.
2. Submit proof satisfactory to the director of the following:
(a) The purpose for which the fuel was used.
(b) The tax paid purchase.
3. Make an application in a form prescribed by the department that requests the following information:
(a) Name and address of the claimant.
(b) Period covered by the claim showing dates.
(c) Location of equipment, if applicable.
(d) Gallons on which a refund is claimed.
(e) Amount of the refund claimed.
(f) Other information required by the director.
B. The claim shall not be under oath but shall contain or be accompanied by a written declaration that it is made under penalties of perjury and, if it is for motor vehicle fuel, that it complies in all respects with section 28‑5611 relating to refunds.
C. The original invoice or a duplicate that is satisfactory to the director and that includes the following information shall accompany the application:
1. The date of purchase.
2. The seller's name and address.
3. The number of gallons purchased.
4. The type of fuel purchased.
5. The price per gallon of the fuel.
6. Other information required by the director.
D. If a person files a claim for a refund pursuant to this section for motor fuel exported, the person shall make satisfactory proof of export to the director and file the claim within three months after the date of export in the form and containing the information required by the director. The original invoice or an acceptable duplicate shall accompany the claim.
E. The director shall accept only one application for refund of motor fuel taxes for any one person within a six month six-month period if the aggregate total of all motor fuel taxes paid and for which a refund is claimed does not equal at least ten dollars.
F. If a person who is exempt from use fuel taxes pursuant to section 28‑5610 submits a claim for a refund pursuant to this section for use fuel taxes, the department shall not pay the refund until the department determines the difference between the amount of the refund and the amount of the use tax that is imposed under title 42, chapter 5, article 4 on the fuel exempt from use fuel taxes if owed by the person. If the department determines that the amount of the refund is greater than the amount owed for the use tax, the department shall deposit the amount owed for the use tax pursuant to subsection M of this section and refund the amount of the difference to the person. If the department of transportation determines that the amount of the refund is less than the amount owed for the use tax, the department of transportation shall forward any balance due information to the department of revenue for collection.
G. Except as provided in subsection F of this section, if the director does not issue a refund within sixty days after a complete application for refund is filed as prescribed in this article, the director shall pay interest at the rate of eleven per cent percent per year from the date the complete application for refund is filed until the date on which the refund is made.
H. If the director denies a refund, the director shall notify the claimant that the refund is denied. The director's denial is final unless the applicant makes a written request for a hearing as prescribed in section 28‑5924.
I. It is unlawful for a person to knowingly operate a motor vehicle on the highways or a watercraft on the waterways using motor vehicle fuel or use fuel that has been sold to a person making a claim pursuant to this section.
J. In addition to other penalties prescribed by law, the director shall not give a person who violates this section a refund on motor fuel purchased during the six months succeeding the date the director advises the person by mail of the director's discovery of the violation.
K. A person whose right to a refund is suspended may bring an action in superior court in Maricopa County to set aside the suspension.
L. The director may recover excess refunds from the person to whom the refund was made. The director shall assess the claimant the amount of the excess refund and interest. The director shall compute interest at one per cent percent per month of the amount of excess refund due beginning on the date of refund and until the date the assessment is paid.
M. The department of transportation shall deposit, pursuant to sections 35‑146 and 35‑147, use tax revenues collected pursuant to subsection F of this section in the state general fund by the end of each month and notify the department of revenue of the amount of use tax collected each month.
Sec. 8. Section 28-5613, Arizona Revised Statutes, is amended to read:
28-5613. Licensee refunds; definition
A. A licensee who is seeking a refund shall apply pursuant to section 28‑5612, except that a licensee shall file an application for refund within three years after the date of purchase or invoice of the motor fuel for which a refund is claimed.
B. For the purposes of this section, "licensee" includes a supplier, an interstate user, or a restricted distributor or a licensed use fuel vendor.
Sec. 9. Section 28-5614, Arizona Revised Statutes, is amended to read:
28-5614. Refunds; use fuel
A. If a vendor pays the use fuel tax rate for use class motor vehicles on use fuel that is actually used in the propulsion of a light class motor vehicle on a highway in this state or that is actually used in the propulsion of a use class motor vehicle that is exempt pursuant to section 28‑5432 from the weight fee prescribed in section 28‑5433 on a highway in this state and for the purpose of convenience and facility only, the vendor may apply to the department for a refund of the difference between the amount of the use class motor vehicle use fuel tax paid and the amount of the light class motor vehicle use fuel tax on the same number of gallons purchased.
B. A. If a person who transports forest products on a highway in this state in compliance with the requirements of section 41‑1516 pays the use fuel tax rate prescribed in section 28‑5606, subsection B, paragraph 2 1 for a use class motor vehicle that is eligible for the use fuel tax rate prescribed in section 28‑5606, subsection B, paragraph 3 2, the person may apply to the department for a refund of the difference between the amount of the use fuel tax paid and the use fuel tax rate prescribed for a motor vehicle transporting forest products.
C. B. The director may prescribe any forms the director deems necessary to implement this section.
D. A vendor may file an application for a refund pursuant to this section either:
1. On a monthly basis subject to the limitations prescribed in section 28‑5612.
2. If the amount of the requested refund is at least seven hundred fifty dollars, except that a vendor shall not file an application for a refund pursuant to this paragraph more frequently than once each week.
E. C. The director shall:
1. Pay the refund from current use fuel tax receipts.
2. Deduct the refund from the monthly use fuel tax receipts before the deposit pursuant to section 28‑5730 is made.
Sec. 10. Section 28-5615, Arizona Revised Statutes, is amended to read:
28-5615. Presumption of use
A. For the proper administration of this article and to prevent evasion of the use fuel tax, it is presumed, until the contrary is established by competent proof under rules and procedures the director adopts, that all use fuel received into any receptacle on a motor vehicle from which fuel is supplied to propel the vehicle is consumed in propelling the vehicle on the highways in this state.
B. If a vendor's dealings in use fuel primarily involve delivery of use fuel into the fuel tanks of motor vehicles it is presumed, until the contrary is established by competent proof under rules and procedures the director adopts, that the vendor's total use fuel acquisitions have been delivered into the fuel tanks of motor vehicles for the propulsion of the vehicles on the public highways.
Sec. 11. Repeal
Section 28-5617, Arizona Revised Statutes, is repealed.
Sec. 12. Section 28-5619, Arizona Revised Statutes, is amended to read:
28-5619. Records required; violation; classification
A. Suppliers and restricted distributors shall maintain and keep records of motor vehicle fuel or aviation fuel received, acquired, used, sold and delivered in this state by the supplier or restricted distributor, the amount of tax paid as part of the purchase price, invoices, bills of lading and other pertinent records and papers required by the director for the reasonable administration of this article at least until the later of the following:
1. Three years after a report is required to be filed pursuant to this article.
2. Three years after a report is filed.
B. Any person, other than a restricted distributor, purchasing motor vehicle fuel taxable under this article or aviation fuel taxable under section 28‑8344 from a supplier for the purpose of resale shall maintain and keep for one year a record of motor vehicle fuel or aviation fuel received, the amount of tax paid to the supplier as part of the purchase price, delivery tickets, invoices, bills of lading and other records the director requires.
C. Each distributor and vendor shall maintain and keep for three years the following:
1. Records of use fuel received, sold or delivered in this state by the distributor or vendor.
2. Invoices, bills of lading and other pertinent records and papers required by the director for the reasonable administration of this article.
D. The director may require distributors to file information as to sales or deliveries to vendors or users of use fuel at the times and in the form as the director requires.
E. A person who violates this section is guilty of a class 1 misdemeanor.
Sec. 13. Section 28-5620, Arizona Revised Statutes, is amended to read:
28-5620. Records and equipment inspections; hearings; costs
A. The director or a deputy, employee or agent authorized by the director may examine during usual business hours records, books, papers, storage tanks and any other equipment of a person pertaining to motor fuel imported, received, sold, shipped, delivered or used to either:
1. Verify the truth and accuracy of a statement, report, return or claim.
2. Ascertain whether the tax imposed by this article or section 28‑8344 has been paid.
3. Determine the financial responsibility of the supplier for the payment of the taxes imposed by this article or section 28‑8344.
4. Determine the validity of a refund.
B. In the enforcement of this article, the director may hold hearings, take testimony of persons, issue subpoenas for the purpose of taking testimony, compel attendance of witnesses and conduct investigations the director deems necessary.
C. The director may prescribe forms for required reports or claims for refund or forms of record to be used by suppliers, distributors, restricted distributors, vendors or refund claimants.
D. Records required by this article may be maintained in this state. If the records are maintained outside this state and on request of the director, the records shall be made available at a location in this state designated by the director. If the records are maintained outside this state and will not be made available at the location designated by the director, the director may require the person to whom a records request has been made to pay in advance costs reimbursable for subsistence and travel expenses for the director or an agent of the director to conduct the examination of the records.
Sec. 14. Repeal
Section 28-5623, Arizona Revised Statutes, is repealed.
Sec. 15. Section 28-5626, Arizona Revised Statutes, is amended to read:
28-5626. Suppliers; licenses required
A. Except as provided in section 28‑5607, a person who acts as a distributor and who possesses motor fuel on which fuel taxes have not been accrued or collected by a supplier shall be licensed as a supplier.
B. It is unlawful for a person to engage in business in this state as a supplier, unless the person has a license issued by the director to engage in that business.
C. A person who sells use fuel for delivery directly into a vehicle fuel tank shall also be licensed as a vendor and shall maintain separate business records.
Sec. 16. Section 28-5638, Arizona Revised Statutes, is amended to read:
28-5638. Deferred remittance election eligibility
A. Each purchaser that desires to make an election under section 28‑5637 shall present evidence to the department that either:
1. The applicant was a licensed distributor in good standing before January 1, 1998.
2. The applicant meets the financial responsibility and bonding requirements imposed by this article. The bond shall conform to the specific requirements of this section.
B. The department may require a purchaser that pays the tax to a supplier to file with the department a surety bond that is payable to this state and on which the purchaser is the obligor, or other financial security, in an amount satisfactory to the department. The department may require that the bond indemnify the department against uncollectible tax credits claimed by the supplier under section 28‑5639.
C. The department may rescind a purchaser's eligibility and election to defer motor vehicle or aviation fuel tax remittances after a hearing and on a showing of good cause, including failure to make a timely tax deferred payment of tax to a supplier under section 28‑5637, by sending written notice to all suppliers or publishing notice of the revocation pursuant to rules. The department may require further assurance of the financial responsibility of the purchaser, may increase the bond requirement for that purchaser or may take any other action that the department may require to ensure remittance of the motor vehicle or aviation fuel tax.
Sec. 17. Section 28-5731, Arizona Revised Statutes, is amended to read:
28-5731. Record requirements
A. A licensee under this article shall make records as prescribed and in the manner required by the director as reasonably necessary to substantiate reports required by this article. A licensee shall retain those records at least until the later of the following:
1. Three years after a report is required to be filed pursuant to section 28‑5732.
2. Three years after a report is filed.
B. The records shall include receipts pursuant to section 28‑5617 for each sale or transfer of use fuel for use in a use class motor vehicle. In addition to the information required by section 28‑5617, a licensee shall identify the motor vehicle by license plate number or unit number on the receipt or transaction listing.
C. B. The director may examine the books, papers, records and equipment of any person using, dealing in, transporting or storing fuel to determine whether the use fuel taxes due under article 1 of this chapter are properly reported and paid.
D. C. A person from whom the director has requested records may:
1. Make the records available at the office designated by the director.
2. If the place of business where records may be audited is located in this state, request the director to audit the records at the person's place of business.
E. D. If the person does not make records available at the office designated by the director and the place of business where records may be audited is located outside this state, the director may require the person to pay the department in advance for the cost of reimbursing employee subsistence and travel expenses.
