I

107TH CONGRESS

1ST SESSION H. R. 1833

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

taxes for six months.

IN THE HOUSE OF REPRESENTATIVES

MAY 15, 2001

Mr. SMITH of Michigan 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 for six months.

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 ‘‘Gas Tax Fairness Act

5 of 2001’’.

6 SEC. 2. SIX-MONTH SUSPENSION OF FUEL TAXES.

7 (a) SIX-MONTH SUSPENSION OF FUEL TAXES.—Sec8 tion 4081 of the Internal Revenue Code of 1986 (relating

9 to imposition of tax on gasoline, diesel fuel, and kerosene)
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1 is amended by adding at the end the following new sub2 section:

3 ‘‘(f) TEMPORARY SUSPENSION OF FUEL TAXES.—

4 ‘‘(1) IN GENERAL.—During the suspension pe5 riod, each rate of tax referred to in paragraph (2)

6 shall be reduced to zero.

7 ‘‘(2) RATES OF TAX.—The rates of tax referred

8 to in this paragraph are the rates of tax otherwise

9 applicable under—

10 ‘‘(A) subsection (a)(2)(A) (relating to gas11 oline, diesel fuel, and kerosene),

12 ‘‘(B) sections 4091(b)(3)(A) (relating to

13 aviation fuel),

14 ‘‘(C) section 4042(b)(2)(C) (relating to

15 fuel used on inland waterways),

16 ‘‘(D) paragraph (1), (2), or (3) of section

17 4041(a) (relating to diesel fuel, special fuels,

18 and compressed natural gas), and

19 ‘‘(E) section 4041(m)(1)(A)(i) (relating to

20 certain methanol or ethanol fuels).

21 ‘‘(3) SUSPENSION PERIOD.—For purposes of

22 this subsection, the term ‘suspension period’ means

23 the period beginning on July 1, 2001, and ending on

24 December 31, 2001.’’
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1 (b) EFFECTIVE DATE.—The amendment made by

2 this section shall take effect on the date of the enactment

3 of this Act.

4 SEC. 3. FLOOR STOCK REFUNDS.

5 (a) IN GENERAL.—If—

6 (1) before the tax suspension date, tax has been

7 imposed under section 4081 or 4091 of the Internal

8 Revenue Code of 1986 on any liquid, and

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

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

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

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

13 referred to as the ‘‘taxpayer’’) an amount equal to the ex14 cess of the tax paid by the taxpayer over the amount of

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

16 taxable event occurred on such date.

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

18 shall be allowed or made under this section unless—

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

20 the Treasury before the date which is 6 months

21 after the tax suspension date, and

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

23 (other than the taxpayer) on the tax suspension

24 date—
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1 (A) the dealer submits a request for refund

2 or credit to the taxpayer before the date which

3 is 3 months after the tax suspension date, and

4 (B) the taxpayer has repaid or agreed to

5 repay the amount so claimed to such dealer or

6 has obtained the written consent of such dealer

7 to the allowance of the credit or the making of

8 the refund.

9 (c) EXCEPTION FOR FUEL HELD IN RETAIL

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

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

12 the place where intended to be sold at retail.

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

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

15 have the respective meanings given to such terms by

16 section 6412 of such Code; except that the term

17 ‘‘dealer’’ includes a producer, and

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

19 date on which the suspension period begins under

20 section 4081(f) of the Internal Revenue Code of

21 1986 (as added by section 2).

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

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

24 Code shall apply for purposes of this section.
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1 SEC. 4. FLOOR STOCKS TAX.

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

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

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

5 to the excess of the tax which would be imposed under

6 section 4041, 4081, or 4091 of the Internal Revenue Code

7 of 1986 on such liquid had the taxable event occurred on

8 the floor stocks tax date over the tax paid under such sec9 tions on such liquid.

10 (b) LIABILITY FOR TAX AND METHOD OF PAY11 MENT.—

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

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

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

15 such tax.

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

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

18 the Secretary shall prescribe.

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

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

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

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

23 (1) HELD BY A PERSON.—A liquid shall be con24 sidered as ‘‘held by a person’’ if title thereto has

25 passed to such person (whether or not delivery to

26 the person has been made).
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1 (2) TAXABLE LIQUID.—The term ‘taxable liq2 uid’ means any liquid on which tax is imposed under

3 section 4041, 4081, or 4091 of the Internal Revenue

4 Code of 1986 on the floor stocks tax date.

5 (3) GASOLINE AND DIESEL FUEL.—The terms

6 ‘‘gasoline’’ and ‘‘diesel fuel’’ have the respective

7 meanings given such terms by section 4083 of such

8 Code.

9 (4) AVIATION FUEL.—The term ‘‘aviation fuel’’

10 has the meaning given such term by section 4093 of

11 such Code.

12 (5) FLOOR STOCKS TAX DATE.—The term

13 ‘‘floor stocks tax date’’ means the day after the end

14 of the suspension period under section 4081(f) of

15 such Code (as added by section 2).

16 (6) SECRETARY.—The term ‘‘Secretary’’ means

17 the Secretary of the Treasury or the Secretary’s del18 egate.

19 (d) EXCEPTION FOR EXEMPT USES.—The tax im20 posed by subsection (a) shall not apply to taxable liquid

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

22 a credit or refund of the tax imposed by section 4041,

23 4081, or 4091 of such Code is allowable for such use.

24 (e) EXCEPTION FOR FUEL HELD IN VEHICLE

25 TANK.—No tax shall be imposed by subsection (a) on tax-
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1 able liquid held in the tank of a motor vehicle or motor2 boat.

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

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

5 subsection (a)—

6 (A) on gasoline held on the floor stocks tax

7 date by any person if the aggregate amount of

8 gasoline held by such person on such date does

9 not exceed 4,000 gallons, and

10 (B) on diesel fuel, kerosene, or aviation

11 fuel held on such date by any person if the ag12 gregate amount of diesel fuel, kerosene, or avia13 tion fuel held by such person on such date does

14 not exceed 2,000 gallons.

15 The preceding sentence shall apply only if such per16 son submits to the Secretary (at the time and in the

17 manner required by the Secretary) such information

18 as the Secretary shall require for purposes of this

19 paragraph.

20 (2) EXEMPT FUEL.—For purposes of para21 graph (1), there shall not be taken into account fuel

22 held by any person which is exempt from the tax im23 posed by subsection (a) by reason of subsection (d)

24 or (e).
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1 (3) CONTROLLED GROUPS.—For purposes of

2 this subsection—

3 (A) CORPORATIONS.—

4 (i) IN GENERAL.—All persons treated

5 as a controlled group shall be treated as 1

6 person.

7 (ii) CONTROLLED GROUP.—The term

8 ‘‘controlled group’’ has the meaning given

9 to such term by subsection (a) of section

10 1563 of such Code; except that for such

11 purposes the phrase ‘‘more than 50 per12 cent’’ shall be substituted for the phrase

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

14 in such subsection.

15 (B) NONINCORPORATED PERSONS UNDER

16 COMMON CONTROL.—Under regulations pre17 scribed by the Secretary, principles similar to

18 the principles of subparagraph (A) shall apply

19 to a group of persons under common control

20 where 1 or more of such persons is not a cor21 poration.

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

23 including penalties, applicable with respect to the taxes

24 imposed by section 4041(a)(2) of such Code in the case

25 of special fuels; by section 4081 of such Code in the case
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1 of gasoline, diesel fuel, and kerosene; and by section 4091

2 of such Code in the case of aviation fuel shall, insofar as

3 applicable and not inconsistent with the provisions of this

4 subsection, apply with respect to the floor stock taxes im5 posed by subsection (a) to the same extent as if such taxes

6 were imposed by such section 4041, 4081, or 4091.

7 SEC. 5. PROTECTION OF HIGHWAY TRUST FUND.

8 The amounts transferred to the Highway Trust Fund

9 under section 9503 of the Internal Revenue Code of 1986

10 shall be determined as if this Act had not been acted.

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