Bill Text: TX HB2763 | 2023-2024 | 88th Legislature | Comm Sub

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Bill Title: Relating to an exemption from motor fuel taxes for certain fuel used by a rural transit district to provide public transportation.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2023-05-11 - Placed on General State Calendar [HB2763 Detail]

Download: Texas-2023-HB2763-Comm_Sub.html

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88R7770 SRA-D
By: Guillen H.B. No. 2763

A BILL TO BE ENTITLED
AN ACT
relating to an exemption from motor fuel taxes for certain fuel used
by a rural transit district to provide public transportation.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Effective January 1, 2026, Section 162.104(a),
Tax Code, is amended to read as follows:
(a) The tax imposed by this subchapter does not apply to
gasoline:
(1) sold to the United States for its exclusive use,
provided that the exemption does not apply with respect to fuel sold
or delivered to a person operating under a contract with the United
States;
(2) sold to a public school district in this state for
the district's exclusive use;
(3) sold to a commercial transportation company or a
metropolitan rapid transit authority operating under Chapter 451,
Transportation Code, that provides public school transportation
services to a school district under Section 34.008, Education Code,
and that uses the gasoline only to provide those services;
(4) exported by either a licensed supplier or a
licensed exporter from this state to any other state, provided that
the bill of lading indicates the destination state and the supplier
collects the destination state tax;
(5) moved by truck or railcar between licensed
suppliers or licensed permissive suppliers and in which the
gasoline removed from the first terminal comes to rest in the second
terminal, provided that the removal from the second terminal rack
is subject to the tax imposed by this subchapter;
(6) delivered or sold into a storage facility of a
licensed aviation fuel dealer from which gasoline will be delivered
solely into the fuel supply tanks of aircraft or aircraft servicing
equipment, or sold from one licensed aviation fuel dealer to
another licensed aviation fuel dealer who will deliver the aviation
fuel exclusively into the fuel supply tanks of aircraft or aircraft
servicing equipment;
(7) exported to a foreign country if the bill of lading
or shipping documents indicate the foreign destination and the fuel
is actually exported to the foreign country;
(8) sold to a volunteer fire department in this state
for the department's exclusive use; [or]
(9) sold to a nonprofit entity that is organized for
the sole purpose of and engages exclusively in providing emergency
medical services and that uses the gasoline exclusively to provide
emergency medical services, including rescue and ambulance
services; or
(10) sold to a rural transit district created under
Chapter 458, Transportation Code, that uses the gasoline
exclusively to provide public transportation.
SECTION 2. Effective January 1, 2026, Section 162.125(a),
Tax Code, is amended to read as follows:
(a) A license holder may take a credit on a return for the
period in which the sale occurred if the license holder paid tax on
the purchase of gasoline and subsequently resells the gasoline
without collecting the tax to:
(1) the United States government for its exclusive
use, provided that a credit is not allowed for gasoline used by a
person operating under contract with the United States;
(2) a public school district in this state for the
district's exclusive use;
(3) an exporter licensed under this subchapter if the
seller is a licensed supplier or distributor and the exporter
subsequently exports the gasoline to another state;
(4) a licensed aviation fuel dealer if the seller is a
licensed distributor; [or]
(5) a commercial transportation company or a
metropolitan rapid transit authority operating under Chapter 451,
Transportation Code, that provides public school transportation
services to a school district under Section 34.008, Education Code,
and that uses the gasoline exclusively to provide those services;
or
(6) a rural transit district created under Chapter
458, Transportation Code, that uses the gasoline exclusively to
provide public transportation.
SECTION 3. Section 162.125(g), Tax Code, is amended to read
as follows:
(g) A transit company that paid tax on the purchase of
gasoline, and is not otherwise entitled to a refund of that tax
under this subchapter, may seek a refund with the comptroller in an
amount equal to one cent per gallon for gasoline used in transit
vehicles.
SECTION 4. Subchapter B, Chapter 162, Tax Code, is amended
by adding Section 162.1276 to read as follows:
Sec. 162.1276. REFUND FOR CERTAIN RURAL TRANSIT DISTRICTS.
(a) A rural transit district created under Chapter 458,
Transportation Code, is entitled to a refund in the amount provided
by this section of taxes paid under this subchapter for gasoline
used to provide public transportation and may file a refund claim
with the comptroller for that amount.
(b) The refund claim under Subsection (a) must contain
information regarding:
(1) vehicle mileage;
(2) hours of service provided; and
(3) fuel consumed.
(c) A rural transit district that requests a refund under
this section shall maintain all supporting documentation relating
to the refund until the sixth anniversary of the date of the
request.
(d) The amount of the refund under Subsection (a) is equal
to the amount of tax paid under this subchapter for gasoline that
qualifies for the refund and is purchased by the rural transit
district.
(e) Notwithstanding Subsection (d), the amount of the
refund under Subsection (a) is equal to:
(1) 50 percent of the amount of tax paid under this
subchapter for gasoline that qualifies for the refund and is
purchased by the rural transit district on or after January 1, 2024,
and before January 1, 2025; and
(2) 75 percent of the amount of tax paid under this
subchapter for gasoline that qualifies for the refund and is
purchased by the rural transit district on or after January 1, 2025,
and before January 1, 2026.
(f) Subsection (e) and this subsection expire September 1,
2026.
SECTION 5. Effective January 1, 2026, Section 162.204(a),
Tax Code, is amended to read as follows:
(a) The tax imposed by this subchapter does not apply to:
(1) diesel fuel sold to the United States for its
exclusive use, provided that the exemption does not apply to diesel
fuel sold or delivered to a person operating under a contract with
the United States;
(2) diesel fuel sold to a public school district in
this state for the district's exclusive use;
(3) diesel fuel sold to a commercial transportation
company or a metropolitan rapid transit authority operating under
Chapter 451, Transportation Code, that provides public school
transportation services to a school district under Section 34.008,
Education Code, and that uses the diesel fuel only to provide those
services;
(4) diesel fuel exported by either a licensed supplier
or a licensed exporter from this state to any other state, provided
that the bill of lading indicates the destination state and the
supplier collects the destination state tax;
(5) diesel fuel moved by truck or railcar between
licensed suppliers or licensed permissive suppliers and in which
the diesel fuel removed from the first terminal comes to rest in the
second terminal, provided that the removal from the second terminal
rack is subject to the tax imposed by this subchapter;
(6) diesel fuel delivered or sold into a storage
facility of a licensed aviation fuel dealer from which the diesel
fuel will be delivered solely into the fuel supply tanks of aircraft
or aircraft servicing equipment, or sold from one licensed aviation
fuel dealer to another licensed aviation fuel dealer who will
deliver the diesel fuel exclusively into the fuel supply tanks of
aircraft or aircraft servicing equipment;
(7) diesel fuel exported to a foreign country if the
bill of lading or shipping documents indicate the foreign
destination and the fuel is actually exported to the foreign
country;
(8) dyed diesel fuel sold or delivered by a supplier to
another supplier and dyed diesel fuel sold or delivered by a
supplier or distributor into the bulk storage facility of a dyed
diesel fuel bonded user or to a purchaser who provides a signed
statement as provided by Section 162.206;
(9) the volume of water, fuel ethanol, renewable
diesel, biodiesel, or mixtures thereof that are blended together
with taxable diesel fuel when the finished product sold or used is
clearly identified on the retail pump, storage tank, and sales
invoice as a combination of diesel fuel and water, fuel ethanol,
renewable diesel, biodiesel, or mixtures thereof;
(10) dyed diesel fuel sold by a supplier or permissive
supplier to a distributor, or by a distributor to another
distributor;
(11) dyed diesel fuel delivered by a license holder
into the fuel supply tanks of railway engines, motorboats, or
refrigeration units or other stationary equipment powered by a
separate motor from a separate fuel supply tank;
(12) dyed kerosene when delivered by a supplier,
distributor, or importer into a storage facility at a retail
business from which all deliveries are exclusively for heating,
cooking, lighting, or similar nonhighway use;
(13) diesel fuel used by a person, other than a
political subdivision, who owns, controls, operates, or manages a
commercial motor vehicle as defined by Section 548.001,
Transportation Code, if the fuel:
(A) is delivered exclusively into the fuel supply
tank of the commercial motor vehicle; and
(B) is used exclusively to transport passengers
for compensation or hire between points in this state on a fixed
route or schedule;
(14) diesel fuel sold to a volunteer fire department
in this state for the department's exclusive use; [or]
(15) diesel fuel sold to a nonprofit entity that is
organized for the sole purpose of and engages exclusively in
providing emergency medical services and that uses the diesel fuel
exclusively to provide emergency medical services, including
rescue and ambulance services; or
(16) diesel fuel sold to a rural transit district
created under Chapter 458, Transportation Code, that uses the
diesel fuel exclusively to provide public transportation.
SECTION 6. Effective January 1, 2026, Section 162.227(a),
Tax Code, is amended to read as follows:
(a) A license holder may take a credit on a return for the
period in which the sale occurred if the license holder paid tax on
the purchase of diesel fuel and subsequently resells the diesel
fuel without collecting the tax to:
(1) the United States government for its exclusive
use, provided that a credit is not allowed for gasoline used by a
person operating under a contract with the United States;
(2) a public school district in this state for the
district's exclusive use;
(3) an exporter licensed under this subchapter if the
seller is a licensed supplier or distributor and the exporter
subsequently exports the diesel fuel to another state;
(4) a licensed aviation fuel dealer if the seller is a
licensed distributor; [or]
(5) a commercial transportation company or a
metropolitan rapid transit authority operating under Chapter 451,
Transportation Code, that provides public school transportation
services to a school district under Section 34.008, Education Code,
and that uses the diesel fuel exclusively to provide those
services; or
(6) a rural transit district created under Chapter
458, Transportation Code, that uses the diesel fuel exclusively to
provide public transportation.
SECTION 7. Section 162.227(f), Tax Code, is amended to read
as follows:
(f) A transit company who paid tax on the purchase of diesel
fuel, and is not otherwise entitled to a refund of that tax under
this subchapter, may seek a refund with the comptroller of one-half
of one cent per gallon for diesel fuel used in transit vehicles.
SECTION 8. Subchapter C, Chapter 162, Tax Code, is amended
by adding Section 162.2276 to read as follows:
Sec. 162.2276. REFUND FOR CERTAIN RURAL TRANSIT DISTRICTS.
(a) A rural transit district created under Chapter 458,
Transportation Code, is entitled to a refund in the amount provided
by this section of taxes paid under this subchapter for diesel fuel
used to provide public transportation and may file a refund claim
with the comptroller for that amount.
(b) The refund claim under Subsection (a) must contain
information regarding:
(1) vehicle mileage;
(2) hours of service provided; and
(3) fuel consumed.
(c) A rural transit district that requests a refund under
this section shall maintain all supporting documentation relating
to the refund until the sixth anniversary of the date of the
request.
(d) The amount of the refund under Subsection (a) is equal
to the amount of tax paid under this subchapter for diesel fuel that
qualifies for the refund and is purchased by the rural transit
district.
(e) Notwithstanding Subsection (d), the amount of the
refund under Subsection (a) is equal to:
(1) 50 percent of the amount of tax paid under this
subchapter for diesel fuel that qualifies for the refund and is
purchased by the rural transit district on or after January 1, 2024,
and before January 1, 2025; and
(2) 75 percent of the amount of tax paid under this
subchapter for diesel fuel that qualifies for the refund and is
purchased by the rural transit district on or after January 1, 2025,
and before January 1, 2026.
(f) Subsection (e) and this subsection expire September 1,
2026.
SECTION 9. Effective January 1, 2026, Section 162.356(a),
Tax Code, is amended to read as follows:
(a) The tax imposed by this subchapter does not apply to
compressed natural gas or liquefied natural gas delivered into the
fuel supply tank of:
(1) a motor vehicle operated exclusively by the United
States, provided that the exemption does not apply with respect to
fuel delivered into the fuel supply tank of a motor vehicle of a
person operating under a contract with the United States;
(2) a motor vehicle operated exclusively by a public
school district in this state;
(3) a motor vehicle operated exclusively by a
commercial transportation company or a metropolitan rapid transit
authority operating under Chapter 451, Transportation Code, that
provides public school transportation services to a school district
under Section 34.008, Education Code, and that uses the fuel only to
provide those services;
(4) a motor vehicle operated exclusively by a
volunteer fire department in this state;
(5) a motor vehicle operated exclusively by a
municipality or county in this state;
(6) a motor vehicle operated exclusively by a
nonprofit electric cooperative corporation organized under Chapter
161, Utilities Code;
(7) a motor vehicle operated exclusively by a
nonprofit telephone cooperative corporation organized under
Chapter 162, Utilities Code;
(8) a motor vehicle that is not registered for use on
the public highways of this state and that is used exclusively
off-highway;
(9) a motor vehicle operated exclusively by a
nonprofit entity that is organized for the sole purpose of and
engages exclusively in providing emergency medical services and
that uses the fuel exclusively to provide emergency medical
services, including rescue and ambulance services;
(9-a) a motor vehicle operated exclusively by a rural
transit district created under Chapter 458, Transportation Code,
that uses the fuel exclusively to provide public transportation;
(10) off-highway equipment, a stationary engine, a
motorboat, an aircraft, equipment used solely for servicing
aircraft and used exclusively off-highway, a locomotive, or any
device other than a motor vehicle operated or intended to be
operated on the public highways; or
(11) except as provided by Subsection (b), a motor
vehicle:
(A) used to provide the services of a transit
company, including a metropolitan rapid transit authority under
Chapter 451, Transportation Code, or a regional transportation
authority under Chapter 452, Transportation Code; and
(B) operated by a person who on January 1, 2015,
paid tax on compressed natural gas or liquefied natural gas as
provided by Section 162.312, as that section existed on that date.
SECTION 10. Subchapter D-1, Chapter 162, Tax Code, is
amended by adding Section 162.3685 to read as follows:
Sec. 162.3685. REFUND FOR CERTAIN RURAL TRANSIT DISTRICTS.
(a) A rural transit district created under Chapter 458,
Transportation Code, is entitled to a refund in the amount provided
by this section of taxes paid under this subchapter for compressed
natural gas or liquefied natural gas delivered into the fuel supply
tank of a motor vehicle used to provide public transportation and
may file a refund claim with the comptroller for that amount.
(b) The refund claim under Subsection (a) must contain
information regarding:
(1) vehicle mileage;
(2) hours of service provided; and
(3) fuel consumed.
(c) A rural transit district that requests a refund under
this section shall maintain all supporting documentation relating
to the refund until the sixth anniversary of the date of the
request.
(d) The amount of the refund under Subsection (a) is equal
to the amount of tax paid under this subchapter for compressed
natural gas or liquefied natural gas that qualifies for the refund
and is delivered into the fuel supply tank of a motor vehicle.
(e) Notwithstanding Subsection (d), the amount of the
refund under Subsection (a) is equal to:
(1) 50 percent of the amount of tax paid under this
subchapter for compressed natural gas or liquefied natural gas that
qualifies for the refund and is delivered into the fuel supply tank
of a motor vehicle on or after January 1, 2024, and before January
1, 2025; and
(2) 75 percent of the amount of tax paid under this
subchapter for compressed natural gas or liquefied natural gas that
qualifies for the refund and is delivered into the fuel supply tank
of a motor vehicle on or after January 1, 2025, and before January
1, 2026.
(f) Subsection (e) and this subsection expire September 1,
2026.
SECTION 11. A tax imposed by Chapter 162, Tax Code, does not
apply to gasoline, diesel fuel, compressed natural gas, or
liquefied natural gas to the extent a rural transit district is
entitled to a refund of the tax under Section 162.1276(e)(1) or (2),
Section 162.2276(e)(1) or (2), or Section 162.3685(e)(1) or (2),
Tax Code, as added by this Act. However, the tax must be paid as
otherwise required by law and a rural transit district may apply to
the comptroller for the refund provided by that added law.
SECTION 12. A change in law made by this Act does not affect
tax liability accruing before the effective date of the change in
law. That liability continues in effect as if this Act had not been
enacted, and the former law is continued in effect for the
collection of taxes due and for civil and criminal enforcement of
the liability for those taxes.
SECTION 13. Except as otherwise provided by this Act, this
Act takes effect January 1, 2024.