I

106TH CONGRESS

2D SESSION H. R. 4776

To amend the Internal Revenue Code of 1986 to suspend all motor fuel

taxes until March 31, 2001, to permanently repeal the 4.3 cent per

gallon increases in rail, barge, and aviation fuel taxes enacted in 1993,

and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

JUNE 28, 2000

Mr. COLLINS (for himself, Mr. HAYWORTH, Mr. KINGSTON, Mr. SAM JOHNSON of Texas, Mr. BLUNT, Mr. MCKEON, Mr. HOBSON, Mr. BISHOP, Mr.

ENGLISH, Mr. LOBIONDO, Mr. LINDER, Mr. COBURN, Mr. HEFLEY, and

Mr. NORWOOD) introduced the following bill; which was referred to the

Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to suspend

all motor fuel taxes until March 31, 2001, to permanently repeal the 4.3 cent per gallon increases in rail,

barge, and aviation fuel taxes enacted in 1993, and for

other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Fuel Excise Tax Relief

5 Act’’.
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1 SEC. 2. SUSPENSION OF FUEL TAXES THROUGH MARCH 31,

2 2001.

3 (a) TEMPORARY SUSPENSION OF FUEL TAXES.—

4 During the suspension period, each rate of tax referred

5 to in subsection (b) shall be reduced to zero.

6 (b) RATES OF TAX.—The rates of tax referred to in

7 this subsection are the rates of tax otherwise applicable

8 under—

9 (1) paragraphs (1), (2), and (3) of section

10 4041(a) of the Internal Revenue Code of 1986 (re11 lating to diesel fuel and special motor fuels),

12 (2) subsection (m) of section 4041 of such Code

13 (relating to certain alcohol fuels),

14 (3) subparagraphs (A) and (C) of section

15 4042(b)(1) of such Code (relating to tax on fuel

16 used in commercial transportation on inland water17 ways),

18 (4) clauses (i), (ii), and (iii) of section

19 4081(a)(2)(A) of such Code (relating to gasoline,

20 diesel fuel, and kerosene),

21 (5) paragraph (1) of section 4091(b) of such

22 Code (relating to aviation fuel), and

23 (6) paragraph (2) of section 4092(b) of such

24 Code (relating to fuel used in commercial aviation).

25 (c) SUSPENSION PERIOD.—For purposes of this sec26 tion, the term ‘‘suspension period’’ means period begin-
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1 ning on the date of the enactment of this Act and ending

2 on March 31, 2001.

3 SEC. 3. REPEAL OF 1993 INCREASES IN CERTAIN MOTOR

4 FUEL TAXES.

5 (a) DIESEL FUEL USED IN TRAINS.—Subparagraph

6 (C) of section 4041(a)(1) of the Internal Revenue Code

7 of 1986 is amended by striking clause (ii) and by redesig8 nating clause (iii) as clause (ii).

9 (b) FUEL USED ON INLAND WATERWAYS.—

10 (1) Paragraph (1) of section 4042(b) of such

11 Code is amended by adding ‘‘and’’ at the end of sub12 paragraph (A), by striking ‘‘, and’’ at the end of

13 subparagraph (B) and inserting a period, and by

14 striking subparagraph (C).

15 (2) Paragraph (2) of section 4042(b) of such

16 Code is amended by striking subparagraph (C).

17 (c) GASOLINE USED IN TRAINS.—Clause (i) of sec18 tion 4081(a)(2)(A) of such Code is amended by inserting

19 before the comma at the end the following: ‘‘(14 cents in

20 the case of gasoline used in trains)’’.

21 (d) AVIATION GASOLINE.—Clause (ii) of section

22 4081(a)(2)(A) of such Code is amended by striking ‘‘19.3

23 cents’’ and inserting ‘‘15 cents’’.
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1 (e) AVIATION FUEL.—Paragraph (1) of section

2 4091(b) of such Code is amended by striking ‘‘21.8 cents’’

3 and inserting ‘‘17.5 cents’’.

4 (f) TECHNICAL AMENDMENTS.—

5 (1) Subparagraph (A) of section 4041(a)(1) of

6 such Code is amended by striking ‘‘or a diesel-pow7 ered train’’ each place it appears and by striking ‘‘or

8 train’’.

9 (2) Subparagraph (C) of section 4041(b)(1) of

10 such Code is amended by striking all that follows

11 ‘‘section 6421(e)(2)’’ and inserting a period.

12 (3) Subsection (d) of section 4041 of such Code

13 is amended by redesignating paragraph (3) as para14 graph (4) and by inserting after paragraph (2) the

15 following new paragraph:

16 ‘‘(3) DIESEL FUEL USED IN TRAINS.—There is

17 hereby imposed a tax of 0.1 cent per gallon on any

18 liquid other than gasoline (as defined in section

19 4083)—

20 ‘‘(A) sold by any person to an owner, les21 see, or other operator of a diesel-powered train

22 for use as a fuel in such train, or

23 ‘‘(B) used by any person as a fuel in a die24 sel-powered train unless there was a taxable

25 sale of such fuel under subparagraph (A).
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1 No tax shall be imposed by this paragraph on the

2 sale or use of any liquid if tax was imposed on such

3 liquid under section 4081.’’

4 (4) Paragraph (2) of section 4081(d) of such

5 Code is amended to read as follows:

6 ‘‘(2) AVIATION GASOLINE.—The rate of tax

7 specified in subsection (a)(2)(A)(ii) shall be zero

8 after September 30, 2007.’’.

9 (5) Subsection (f) of section 4082 of such Code

10 is amended by striking ‘‘section 4041(a)(1)’’ and in11 serting ‘‘subsections (d)(3) and (a)(1) of section

12 4041, respectively’’.

13 (6) Paragraph (3) of section 4083(a) of such

14 Code is amended by striking ‘‘or a diesel-powered

15 train’’.

16 (7) Subparagraph (A) of section 4091(b)(3) of

17 such Code is amended to read as follows:

18 ‘‘(A) The rate of tax specified in para19 graph (1) shall be zero after September 30,

20 2007.’’

21 (8) Paragraph (1) of section 4091(c) of such

22 Code is amended—

23 (A) by striking ‘‘14 cents’’ and inserting

24 ‘‘9.7 cents’’,
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1 (B) by striking ‘‘13.3 cents’’ and inserting

2 ‘‘9 cents’’,

3 (C) by striking ‘‘13.2 cents’’ and inserting

4 ‘‘8.9 cents’’,

5 (D) by striking ‘‘13.1 cents’’ and inserting

6 ‘‘8.8 cents’’, and

7 (E) by striking ‘‘13.4 cents’’ and inserting

8 ‘‘9.1 cents’’.

9 (9) Subsection (c) of section 4091 of such Code

10 is amended by striking paragraph (4), and by redes11 ignating paragraph (5) as paragraph (4).

12 (10) Subsection (b) of section 4092 of such

13 Code is amended by striking ‘‘attributable to’’ and

14 all that follows and inserting ‘‘attributable to the

15 Leaking Underground Storage Tank Trust Fund fi16 nancing rate imposed by such section. For purposes

17 of the preceding sentence, the term ‘commercial

18 aviation’ means any use of an aircraft other than in

19 noncommercial aviation (as defined in section

20 4041(c)(2)).’’

21 (11) Subparagraph (B) of section 6421(f)(2) of

22 such Code is amended by striking ‘‘and,’’ and all

23 that follows and inserting a period.

24 (12) Paragraph (3) of section 6421(f) of such

25 Code is amended to read as follows:
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1 ‘‘(3) GASOLINE USED IN TRAINS.—In the case

2 of gasoline used as a fuel in a train, this section

3 shall not apply with respect to the Leaking Under4 ground Storage Tank Trust Fund financing rate

5 under section 4081.’’

6 (13) Paragraph (3) of section 6427(l) of such

7 Code is amended to read as follows:

8 ‘‘(3) REFUND OF CERTAIN TAXES ON FUEL

9 USED IN DIESEL-POWERED TRAINS.—For purposes

10 of this subsection, the term ‘nontaxable use’ includes

11 fuel used in a diesel-powered train. The preceding

12 sentence shall not apply to the tax imposed by sec13 tion 4041(d) and the Leaking Underground Storage

14 Tank Trust Fund financing rate under section 4081

15 except with respect to fuel sold for exclusive use by

16 a State or any political subdivision thereof.’’

17 (14) Paragraph (4) of section 6427(l) of such

18 Code is amended by striking ‘‘attributable to’’ and

19 all that follows through the period and inserting ‘‘at20 tributable to the Leaking Underground Storage

21 Tank Trust Fund financing rate imposed by such

22 section.’’

23 (g) EFFECTIVE DATE.—The amendments made by

24 this section shall take effect on April 1, 2001.
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1 SEC. 4. FLOOR STOCK REFUNDS.

2 (a) IN GENERAL.—If—

3 (1) before the tax suspension date, a tax re4 ferred to in section 2(b) has been imposed under the

5 Internal Revenue Code of 1986 on any liquid, and

6 (2) on such date such liquid is held by a dealer

7 and has not been used and is intended for sale,

8 there shall be credited or refunded (without interest) to

9 the person who paid such tax (hereafter in this section

10 referred to as the ‘‘taxpayer’’) an amount equal to the ex11 cess of the tax paid by the taxpayer over the amount of

12 such tax which would be imposed on such liquid had the

13 taxable event occurred on such date.

14 (b) TIME FOR FILING CLAIMS.—No credit or refund

15 shall be allowed or made under this section unless—

16 (1) claim therefor is filed with the Secretary of

17 the Treasury before the date which is 6 months

18 after the tax suspension date, and

19 (2) in any case where liquid is held by a dealer

20 (other than the taxpayer) on the tax suspension

21 date—

22 (A) the dealer submits a request for refund

23 or credit to the taxpayer before the date which

24 is 3 months after the tax suspension date, and

25 (B) the taxpayer has repaid or agreed to

26 repay the amount so claimed to such dealer or
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1 has obtained the written consent of such dealer

2 to the allowance of the credit or the making of

3 the refund.

4 (c) EXCEPTION FOR FUEL HELD IN RETAIL

5 STOCKS.—No credit or refund shall be allowed under this

6 section with respect to any liquid in retail stocks held at

7 the place where intended to be sold at retail.

8 (d) DEFINITIONS.—For purposes of this section—

9 (1) the terms ‘‘dealer’’ and ‘‘held by a dealer’’

10 have the respective meanings given to such terms by

11 section 6412 of such Code; except that the term

12 ‘‘dealer’’ includes a producer, and

13 (2) the term ‘‘tax suspension date’’ means the

14 date on which the suspension period begins under

15 section 2(b).

16 (e) CERTAIN RULES TO APPLY.—Rules similar to the

17 rules of subsections (b) and (c) of section 6412 of such

18 Code shall apply for purposes of this section.

19 SEC. 5. FLOOR STOCKS TAX.

20 (a) IMPOSITION OF TAX.—In the case of any taxable

21 liquid which is held on the floor stocks tax date by any

22 person, there is hereby imposed a floor stocks tax equal

23 to the excess of the tax which would be imposed on such

24 liquid under any section of the Internal Revenue Code of

25 1986 referred to in section 2(b) had the taxable event oc-
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1 curred on the floor stocks tax date over the tax paid under

2 any such section on such liquid.

3 (b) LIABILITY FOR TAX AND METHOD OF PAY4 MENT.—

5 (1) LIABILITY FOR TAX.—A person holding a

6 liquid on the floor stocks tax date to which the tax

7 imposed by subsection (a) applies shall be liable for

8 such tax.

9 (2) METHOD OF PAYMENT.—The tax imposed

10 by subsection (a) shall be paid in such manner as

11 the Secretary shall prescribe.

12 (3) TIME FOR PAYMENT.—The tax imposed by

13 subsection (a) shall be paid on or before the date

14 which is 6 months after the floor stocks tax date.

15 (c) DEFINITIONS.—For purposes of this section—

16 (1) HELD BY A PERSON.—A liquid shall be con17 sidered as ‘‘held by a person’’ if title thereto has

18 passed to such person (whether or not delivery to

19 the person has been made).

20 (2) TAXABLE LIQUID.—The term ‘taxable liq21 uid’ means any liquid on which a tax referred to in

22 section 2(b) is imposed on the floor stocks tax date.

23 (3) FLOOR STOCKS TAX DATE.—The term

24 ‘‘floor stocks tax date’’ means April 1, 2001.
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1 (4) SECRETARY.—The term ‘‘Secretary’’ means

2 the Secretary of the Treasury or the Secretary’s del3 egate.

4 (d) EXCEPTION FOR EXEMPT USES.—The tax im5 posed by subsection (a) shall not apply to taxable liquid

6 held by any person exclusively for any use to the extent

7 a credit or refund of the tax imposed by a section of the

8 Code referred to in section 2(b) is allowable for such use.

9 (e) EXCEPTION FOR FUEL HELD IN VEHICLE

10 TANK.—No tax shall be imposed by subsection (a) on tax11 able liquid held in the tank of a motor vehicle or motor12 boat.

13 (f) EXCEPTION FOR CERTAIN AMOUNTS OF FUEL.—

14 (1) IN GENERAL.—No tax shall be imposed by

15 subsection (a) on any liquid held on the floor stocks

16 tax date by any person if the aggregate amount of

17 liquid held by such person on such date does not ex18 ceed 2,000 gallons. The preceding sentence shall

19 apply only if such person submits to the Secretary

20 (at the time and in the manner required by the Sec21 retary) such information as the Secretary shall re22 quire for purposes of this paragraph.

23 (2) EXEMPT FUEL.—For purposes of para24 graph (1), there shall not be taken into account fuel

25 held by any person which is exempt from the tax im-
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1 posed by subsection (a) by reason of subsection (d)

2 or (e).

3 (3) CONTROLLED GROUPS.—For purposes of

4 this subsection—

5 (A) CORPORATIONS.—

6 (i) IN GENERAL.—All persons treated

7 as a controlled group shall be treated as 1

8 person.

9 (ii) CONTROLLED GROUP.—The term

10 ‘‘controlled group’’ has the meaning given

11 to such term by subsection (a) of section

12 1563 of such Code; except that for such

13 purposes the phrase ‘‘more than 50 per14 cent’’ shall be substituted for the phrase

15 ‘‘at least 80 percent’’ each place it appears

16 in such subsection.

17 (B) NONINCORPORATED PERSONS UNDER

18 COMMON CONTROL.—Under regulations pre19 scribed by the Secretary, principles similar to

20 the principles of subparagraph (A) shall apply

21 to a group of persons under common control

22 where 1 or more of such persons is not a cor23 poration.

24 (g) OTHER LAW APPLICABLE.—All provisions of law,

25 including penalties, applicable with respect to the taxes
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1 imposed by chapter 31 or 32 of such Code shall, insofar

2 as applicable and not inconsistent with the provisions of

3 this section, apply with respect to the floor stock taxes

4 imposed by subsection (a) to the same extent as if such

5 taxes were imposed by such chapter.

6 SEC. 6. MAINTENANCE OF TRUST FUND DEPOSITS.

7 In determining the amounts to be appropriated to

8 any trust fund, an amount equal to the reduction in reve9 nues to the Treasury by reason of a reduction under this

10 Act in any rate shall be treated as taxes received in the

11 Treasury under such rate.

12 SEC. 7. REPORTING REQUIREMENTS.

13 (a) CHANGES IN FUEL PRICES.—Not later than 30

14 days after the date of the enactment of this Act, the Sec15 retary of Treasury, in consultation with the Secretary of

16 Energy, shall prepare and submit to the Committee on

17 Ways and Means of the House of Representatives and the

18 Committee on Finance of the Senate a study which specifi19 cally addresses the following issues:

20 (1) Changes in the price of gasoline, diesel fuel,

21 and other transportation fuels over the previous 12

22 months.

23 (2) The impact on fuel prices posed by the re24 formulated gas mandate of the Clean Air Act.
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1 (3) The economic feasibility and appropriate2 ness of maintaining the reformulated gas mandate.

3 (b) PASS THROUGH OF TAX REDUCTION.—

4 (1) The Comptroller General of the United

5 States shall conduct a study of the reduction of

6 taxes under this Act to determine whether there has

7 been a pass through to consumers of such reduction.

8 (2) Not later than 60 days after the date of the

9 enactment of this Act, the Comptroller General shall

10 submit to the Committee on Ways and Means of the

11 House of Representatives and the Committee on Fi12 nance of the Senate a report containing the results

13 of the study conducted under paragraph (1).

Æ