Bill Text: IA HSB562 | 2019-2020 | 88th General Assembly | Introduced


Bill Title: A bill for an act relating to the excise taxes on motor fuel and certain special fuel, and including applicability provisions.

Spectrum: Committee Bill

Status: (N/A - Dead) 2020-02-06 - Committee report, recommending passage. H.J. 212. [HSB562 Detail]

Download: Iowa-2019-HSB562-Introduced.html
House Study Bill 562 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON WAYS AND MEANS BILL BY CHAIRPERSON HEIN) A BILL FOR An Act relating to the excise taxes on motor fuel and certain 1 special fuel, and including applicability provisions. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 5098YC (2) 88 mo/ns
H.F. _____ Section 1. Section 452A.3, subsections 1, 2, 3, 4, 5, and 6, 1 Code 2020, are amended to read as follows: 2 1. Except as otherwise provided in this section and in this 3 subchapter , until June 30, 2020, this subsection shall apply 4 to the excise tax imposed on each gallon of motor fuel used for 5 any purpose for the privilege of operating motor vehicles in 6 this state. 7 a. An excise tax of thirty cents is imposed on each gallon 8 of motor fuel other than ethanol blended gasoline classified 9 as E-15 or higher. 10 a. b. The On and after July 1, 2026, an excise tax of 11 thirty cents is imposed on each gallon of ethanol blended 12 gasoline classified as E-15 or higher. Before July 1, 13 2026, the rate of the excise tax on ethanol blended gasoline 14 classified as E-15 or higher shall be based on the number 15 of gallons of ethanol blended gasoline classified as E-15 or 16 higher that is are distributed in this state as expressed as a 17 percentage of the number of gallons of motor fuel distributed 18 in this state, which is referred to as the distribution 19 percentage. For purposes of this subsection paragraph , only 20 ethanol blended gasoline and nonblended gasoline, not including 21 aviation gasoline, shall be used in determining the percentage 22 basis for the excise tax. The department shall determine 23 the percentage basis for each determination period beginning 24 January 1 and ending December 31 based on data from the reports 25 filed pursuant to section 452A.33 . The rate for the excise 26 tax shall apply for the period beginning July 1 and ending 27 June 30 following the end of the determination period. Before 28 July 1, 2026, the rate of the excise tax on each gallon of 29 ethanol blended gasoline classified as E-15 or higher shall be 30 as follows: 31 b. The rate for the excise tax shall be as follows: 32 (1) If the distribution percentage is not greater than fifty 33 ten percent, the rate shall be twenty-nine twenty-four cents 34 for ethanol blended gasoline and thirty cents for motor fuel 35 -1- LSB 5098YC (2) 88 mo/ns 1/ 11
H.F. _____ other than ethanol blended gasoline . 1 (2) If the distribution percentage is greater than fifty 2 ten percent but not greater than fifty-five twelve percent, the 3 rate shall be twenty-nine twenty-four and five-tenths cents for 4 ethanol blended gasoline and thirty and one-tenth cents for 5 motor fuel other than ethanol blended gasoline . 6 (3) If the distribution percentage is greater than 7 fifty-five twelve percent but not greater than sixty fourteen 8 percent, the rate shall be twenty-nine twenty-five cents for 9 ethanol blended gasoline and thirty and three-tenths cents for 10 motor fuel other than ethanol blended gasoline . 11 (4) If the distribution percentage is greater than sixty 12 fourteen percent but not greater than sixty-five sixteen 13 percent, the rate shall be twenty-nine twenty-five and 14 five-tenths cents for ethanol blended gasoline and thirty and 15 five-tenths cents for motor fuel other than ethanol blended 16 gasoline . 17 (5) If the distribution percentage is greater than 18 sixty-five sixteen percent but not greater than seventy 19 eighteen percent, the rate shall be twenty-nine twenty-six 20 cents for ethanol blended gasoline and thirty and seven-tenths 21 cents for motor fuel other than ethanol blended gasoline . 22 (6) If the distribution percentage is greater than 23 seventy eighteen percent but not greater than seventy-five 24 twenty percent, the rate shall be twenty-nine twenty-six and 25 five-tenths cents for ethanol blended gasoline and thirty-one 26 cents for motor fuel other than ethanol blended gasoline . 27 (7) If the distribution percentage is greater than 28 seventy-five twenty percent but not greater than eighty 29 twenty-two percent, the rate shall be twenty-nine and 30 three-tenths twenty-seven cents for ethanol blended gasoline 31 and thirty and eight-tenths cents for motor fuel other than 32 ethanol blended gasoline . 33 (8) If the distribution percentage is greater than eighty 34 twenty-two percent but not greater than eighty-five twenty-six 35 -2- LSB 5098YC (2) 88 mo/ns 2/ 11
H.F. _____ percent, the rate shall be twenty-nine twenty-seven and 1 five-tenths cents for ethanol blended gasoline and thirty and 2 seven-tenths cents for motor fuel other than ethanol blended 3 gasoline . 4 (9) If the distribution percentage is greater than 5 eighty-five twenty-six percent but not greater than ninety 6 thirty-five percent, the rate shall be twenty-nine and 7 seven-tenths twenty-eight cents for ethanol blended gasoline 8 and thirty and four-tenths cents for motor fuel other than 9 ethanol blended gasoline . 10 (10) If the distribution percentage is greater than ninety 11 thirty-five percent but not greater than ninety-five forty-five 12 percent, the rate shall be twenty-nine and nine-tenths 13 twenty-eight and five-tenths cents for ethanol blended gasoline 14 and thirty and one-tenth cents for motor fuel other than 15 ethanol blended gasoline . 16 (11) If the distribution percentage is greater than 17 ninety-five forty-five percent but not greater than sixty-five 18 percent , the rate shall be thirty twenty-nine cents for ethanol 19 blended gasoline and thirty cents for motor fuel other than 20 ethanol blended gasoline . 21 (12) If the distribution percentage is greater than 22 sixty-five percent but not greater than eighty-five percent, 23 the rate shall be twenty-nine and two-tenths cents. 24 (13) If the distribution percentage is greater than 25 eighty-five percent but not greater than ninety-five percent, 26 the rate shall be twenty-nine and five-tenths cents. 27 (14) If the distribution percentage is greater than 28 ninety-five percent, the rate shall be thirty cents. 29 c. The provisions of paragraph “b” and subsection 6 30 3 , paragraph “a” , subparagraph (2), shall be subject to 31 legislative review at least every six five years. The review 32 shall be based upon a fuel distribution percentage formula 33 status report containing the recommendations of a legislative 34 interim committee appointed to conduct a review of the fuel 35 -3- LSB 5098YC (2) 88 mo/ns 3/ 11
H.F. _____ distribution percentage formulas, to be prepared with the 1 assistance of the department of revenue in association 2 with the department of transportation. The report shall 3 include recommendations for changes or revisions to the 4 fuel distribution percentage formulas based upon advances 5 in technology, fuel use trends, and fuel price fluctuations 6 observed during the preceding six-year five-year interval; an 7 analysis of the operation of the fuel distribution percentage 8 formulas during the preceding six-year five-year interval; and 9 a summary of issues that have arisen since the previous review 10 and potential approaches for resolution of those issues. The 11 first such report shall be submitted to the general assembly no 12 later than January 1, 2020, with subsequent reports developed 13 and submitted by January 1 at least every sixth fifth year 14 thereafter. 15 2. Except as otherwise provided in this section and in this 16 subchapter , after June 30, 2020, an excise tax of thirty cents 17 is imposed on each gallon of motor fuel used for any purpose 18 for the privilege of operating motor vehicles in this state. 19 3. An excise tax of seventeen cents is imposed on each 20 gallon of E-85 gasoline, subject to the determination provided 21 in subsection 4. 22 4. The rate of the excise tax on E-85 gasoline imposed in 23 subsection 3 shall be determined based on the number of gallons 24 of E-85 gasoline that are distributed in this state during the 25 previous calendar year. The department shall determine the 26 actual tax paid for E-85 gasoline for each period beginning 27 January 1 and ending December 31. The amount of the tax paid on 28 E-85 gasoline during the past calendar year shall be compared 29 to the amount of tax on E-85 gasoline that would have been paid 30 using the tax rate for gasoline imposed in subsection 1 or 31 2 and a difference shall be established. If this difference 32 is equal to or greater than twenty-five thousand dollars, the 33 tax rate for E-85 gasoline for the period beginning July 1 34 following the end of the determination period shall be the rate 35 -4- LSB 5098YC (2) 88 mo/ns 4/ 11
H.F. _____ in effect as stated in subsection 1 or 2. 1 5. 2. For the privilege of operating aircraft in this state 2 an excise tax of eight cents per gallon is imposed on the use of 3 all aviation gasoline. 4 6. 3. a. For the privilege of operating motor vehicles or 5 aircraft in this state, there is imposed an excise tax on the 6 use of special fuel in a motor vehicle or aircraft. 7 (1) Except as otherwise provided in this section and in 8 this subchapter , for the period ending June 30, 2015, and for 9 the period beginning July 1, 2020, and thereafter, the rate 10 of the excise tax rate on each gallon of special fuel for 11 diesel engines of motor vehicles used for any purpose for the 12 privilege of operating motor vehicles in this state , other 13 than biodiesel blended fuel classified as B-11 or higher, is 14 thirty-two and five-tenths cents per gallon. 15 (2) Except as otherwise provided in this section and in 16 this subchapter , for the period beginning July 1, 2015, and 17 ending June 30, 2020, this subparagraph shall apply to the 18 excise tax imposed on each gallon of special fuel for diesel 19 engines of motor vehicles biodiesel blended fuel classified 20 as B-11 or higher used for any purpose for the privilege of 21 operating motor vehicles in this state. The On and after 22 July 1, 2026, the rate of the excise tax on each gallon 23 of biodiesel blended fuel classified as B-11 or higher is 24 thirty-two and five-tenths cents. Before July 1, 2026, the 25 rate of the excise tax shall be based on the number of gallons 26 of biodiesel blended fuel classified as B-11 or higher that is 27 distributed in this state as expressed as a percentage of the 28 number of gallons of special fuel for diesel engines of motor 29 vehicles distributed in this state, which is referred to as 30 the distribution percentage. The department shall determine 31 the percentage basis for each determination period beginning 32 January 1 and ending December 31 based on data from the reports 33 filed pursuant to section 452A.33 . The rate for of the excise 34 tax shall apply for the period beginning July 1 and ending June 35 -5- LSB 5098YC (2) 88 mo/ns 5/ 11
H.F. _____ 30 following the end of the determination period. The Before 1 July 1, 2026, the rate for of the excise tax on each gallon of 2 biodiesel blended fuel classified as B-11 or higher shall be 3 as follows: 4 (a) If the distribution percentage is not greater than fifty 5 percent, the rate shall be twenty-nine and five-tenths cents 6 for biodiesel blended fuel classified as B-11 or higher and 7 thirty-two and five-tenths cents for special fuel for diesel 8 engines of motor vehicles other than biodiesel blended fuel 9 classified as B-11 or higher . 10 (b) If the distribution percentage is greater than fifty 11 percent but not greater than fifty-five percent, the rate 12 shall be twenty-nine and eight-tenths cents for biodiesel 13 blended fuel classified as B-11 or higher and thirty-two and 14 five-tenths cents for special fuel for diesel engines of motor 15 vehicles other than biodiesel blended fuel classified as B-11 16 or higher . 17 (c) If the distribution percentage is greater than 18 fifty-five percent but not greater than sixty percent, the rate 19 shall be thirty and one-tenth cents for biodiesel blended fuel 20 classified as B-11 or higher and thirty-two and five-tenths 21 cents for special fuel for diesel engines of motor vehicles 22 other than biodiesel blended fuel classified as B-11 or higher . 23 (d) If the distribution percentage is greater than sixty 24 percent but not greater than sixty-five percent, the rate shall 25 be thirty and four-tenths cents for biodiesel blended fuel 26 classified as B-11 or higher and thirty-two and five-tenths 27 cents for special fuel for diesel engines of motor vehicles 28 other than biodiesel blended fuel classified as B-11 or higher . 29 (e) If the distribution percentage is greater than 30 sixty-five percent but not greater than seventy percent, the 31 rate shall be thirty and seven-tenths cents for biodiesel 32 blended fuel classified as B-11 or higher and thirty-two and 33 five-tenths cents for special fuel for diesel engines of motor 34 vehicles other than biodiesel blended fuel classified as B-11 35 -6- LSB 5098YC (2) 88 mo/ns 6/ 11
H.F. _____ or higher . 1 (f) If the distribution percentage is greater than seventy 2 percent but not greater than seventy-five percent, the rate 3 shall be thirty-one cents for biodiesel blended fuel classified 4 as B-11 or higher and thirty-two and five-tenths cents for 5 special fuel for diesel engines of motor vehicles other than 6 biodiesel blended fuel classified as B-11 or higher . 7 (g) If the distribution percentage is greater than 8 seventy-five percent but not greater than eighty percent, the 9 rate shall be thirty-one and three-tenths cents for biodiesel 10 blended fuel classified as B-11 or higher and thirty-two and 11 five-tenths cents for special fuel for diesel engines of motor 12 vehicles other than biodiesel blended fuel classified as B-11 13 or higher . 14 (h) If the distribution percentage is greater than eighty 15 percent but not greater than eighty-five percent, the rate 16 shall be thirty-one and six-tenths cents for biodiesel 17 blended fuel classified as B-11 or higher and thirty-two and 18 five-tenths cents for special fuel for diesel engines of motor 19 vehicles other than biodiesel blended fuel classified as B-11 20 or higher . 21 (i) If the distribution percentage is greater than 22 eighty-five percent but not greater than ninety percent, the 23 rate shall be thirty-one and nine-tenths cents for biodiesel 24 blended fuel classified as B-11 or higher and thirty-two and 25 five-tenths cents for special fuel for diesel engines of motor 26 vehicles other than biodiesel blended fuel classified as B-11 27 or higher . 28 (j) If the distribution percentage is greater than ninety 29 percent but not greater than ninety-five percent, the rate 30 shall be thirty-two and two-tenths cents for biodiesel 31 blended fuel classified as B-11 or higher and thirty-two and 32 five-tenths cents for special fuel for diesel engines of motor 33 vehicles other than biodiesel blended fuel classified as B-11 34 or higher . 35 -7- LSB 5098YC (2) 88 mo/ns 7/ 11
H.F. _____ (k) If the distribution percentage is greater than 1 ninety-five percent, the rate shall be thirty-two and 2 five-tenths cents for biodiesel blended fuel classified as B-11 3 or higher and thirty-two and five-tenths cents for special 4 fuel for diesel engines of motor vehicles other than biodiesel 5 blended fuel classified as B-11 or higher . 6 (3) The rate of the excise tax on special fuel for aircraft 7 is five cents per gallon. 8 (4) On all other special fuel, unless otherwise specified in 9 this section , the per gallon rate of the excise tax is the same 10 as the motor fuel tax under subsection 1 . 11 b. Indelible dye meeting United States environmental 12 protection agency and internal revenue service regulations must 13 be added to fuel before or upon withdrawal at a terminal or 14 refinery rack for that fuel to be exempt from tax and the dyed 15 fuel may be used only for an exempt purpose. 16 Sec. 2. Section 452A.31, subsection 2, paragraph a, 17 subparagraph (1), Code 2020, is amended by adding the following 18 new subparagraph division: 19 NEW SUBPARAGRAPH DIVISION . (c) The total E-15 gasoline 20 gallonage which is the total number of gallons of ethanol 21 blended gasoline classified as E-15 or higher, including E-85 22 gasoline. 23 Sec. 3. Section 452A.31, subsection 3, paragraph a, Code 24 2020, is amended by adding the following new subparagraph: 25 NEW SUBPARAGRAPH . (02) The total B-11 gallonage which 26 is the total number of gallons of biodiesel blended fuel 27 classified as B-11 or higher. 28 Sec. 4. Section 452A.31, subsection 4, paragraph a, 29 subparagraph (1), Code 2020, is amended by adding the following 30 new subparagraph division: 31 NEW SUBPARAGRAPH DIVISION . (c) The aggregate E-15 gasoline 32 gallonage which is the aggregate total number of gallons 33 of ethanol blended gasoline classified as E-15 or higher, 34 including E-85 gasoline. 35 -8- LSB 5098YC (2) 88 mo/ns 8/ 11
H.F. _____ Sec. 5. Section 452A.31, subsection 5, paragraph a, Code 1 2020, is amended by adding the following new subparagraph: 2 NEW SUBPARAGRAPH . (02) The aggregate B-11 gallonage which 3 is the aggregate total number of gallons of biodiesel blended 4 fuel classified as B-11 or higher. 5 Sec. 6. APPLICABILITY. The provision of the section of 6 this Act amending section 452A.3 to require the department 7 of revenue to determine the percentage basis for each 8 determination period beginning January 1 and ending December 9 31 based on data from the reports filed pursuant to section 10 452A.33 for purposes of the excise tax on biodiesel blended 11 fuel classified as B-11 or higher applies to the determination 12 period beginning January 1, 2021, and to each determination 13 period thereafter, for the rate of the excise tax on each 14 gallon of biodiesel blended fuel classified as B-11 or higher 15 beginning July 1, 2021. 16 EXPLANATION 17 The inclusion of this explanation does not constitute agreement with 18 the explanation’s substance by the members of the general assembly. 19 This bill relates to the excise taxes on motor fuel and 20 certain special fuel. 21 Under current law, until June 30, 2020, the per-gallon 22 excise tax on ethanol blended gasoline is up to 2 cents less 23 than the per-gallon excise tax on other motor fuel, based on 24 the distribution percentage of the fuels. After June 30, 2020, 25 the per-gallon excise tax on ethanol blended gasoline and other 26 motor fuel is 30 cents. The bill instead imposes a per-gallon 27 excise tax of 30 cents on motor fuel other than ethanol blended 28 gasoline classified as E-15 or higher. Until July 1, 2026, 29 the bill imposes a per-gallon excise tax on ethanol blended 30 gasoline classified as E-15 or higher that is up to 6 cents 31 less than the per-gallon excise tax on other motor fuel, based 32 on the distribution percentage of the fuels. On and after July 33 1, 2026, the per-gallon excise tax on ethanol blended gasoline 34 classified as E-15 or higher is 30 cents. The bill requires 35 -9- LSB 5098YC (2) 88 mo/ns 9/ 11
H.F. _____ the distribution percentage to be based on data from reports 1 filed pursuant to Code section 452A.33. 2 Current law provides for legislative review of the fuel 3 distribution percentage formulas at least every six years, 4 with the first report due no later than January 1, 2020. The 5 bill instead provides for legislative review of the fuel 6 distribution percentage formulas at least every five years. 7 Under current law, the per-gallon excise tax on E-85 8 gasoline is up to 14 cents less than the per-gallon excise tax 9 on other motor fuel, depending on the amount of excise tax 10 paid on E-85 gasoline during the past calendar year and the 11 amount of the excise tax on other motor fuel. The bill strikes 12 the provisions relating to the per-gallon excise tax on E-85 13 gasoline. 14 Under current law, until June 30, 2020, the per-gallon 15 excise tax on biodiesel blended fuel classified as B-11 or 16 higher is up to 3 cents less than the per-gallon excise tax 17 on other special fuel for diesel engines of motor vehicles, 18 based on the distribution percentage of the fuels. After June 19 30, 2020, the per-gallon excise tax on biodiesel blended fuel 20 classified as B-11 or higher and other special fuel for diesel 21 engines of motor vehicles is 32.5 cents. The bill extends the 22 date on which the per-gallon excise tax on biodiesel blended 23 fuel classified as B-11 or higher becomes 32.5 cents to July 1, 24 2026. For the determination period beginning January 1, 2021, 25 and for each determination period thereafter, the bill requires 26 the distribution percentage to be based on data from reports 27 filed pursuant to Code section 452A.33. 28 The bill creates reporting classifications under Code 29 section 452A.31 for ethanol blended gasoline classified as 30 E-15 or higher and biodiesel blended fuel classified as B-11 31 or higher for purposes of gallonage reports submitted to the 32 department of revenue pursuant to Code section 452A.33. 33 By operation of law, to the extent the excise tax on E-85 34 gasoline and ethanol blended gasoline classified as lower than 35 -10- LSB 5098YC (2) 88 mo/ns 10/ 11
H.F. _____ E-15 is increased more than 0.5 cents per gallon, the inventory 1 tax set forth in Code section 452A.85 applies. 2 -11- LSB 5098YC (2) 88 mo/ns 11/ 11
feedback