II 

108TH CONGRESS 

1ST SESSION S. 251

To amend the Internal Revenue Code of 1986 to repeal the 4.3-cent motor 

fuel excise taxes on railroads and inland waterway transportation which 

remain in the general fund of the Treasury. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 30, 2003

Mr. LOTT (for himself and Mr. BREAUX) introduced the following bill; which 

was read twice and referred to the Committee on Finance 

A BILL

To amend the Internal Revenue Code of 1986 to repeal 

the 4.3-cent motor fuel excise taxes on railroads and 

inland waterway transportation which remain in the general fund of the Treasury.

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 ‘‘Transportation Tax 

5 Equity and Fairness Act’’.
2

•S 251 IS 

1 SEC. 2. REPEAL OF 4.3-CENT MOTOR FUEL EXCISE TAXES 

2 ON RAILROADS AND INLAND WATERWAY 

3 TRANSPORTATION WHICH REMAIN IN GEN4 ERAL FUND. 

5 (a) TAXES ON TRAINS.—

6 (1) IN GENERAL.—Subparagraph (A) of section 

7 4041(a)(1) of the Internal Revenue Code of 1986 

8 (relating to tax on diesel fuel in certain cases) is 

9 amended—

10 (A) by striking ‘‘or a diesel-powered train’’ 

11 in clauses (i) and (ii), and 

12 (B) by striking ‘‘or train’’ in clause (i). 

13 (2) CONFORMING AMENDMENTS.—

14 (A) Subparagraph (C) of section 

15 4041(a)(1) of such Code is amended by striking 

16 clause (ii) and by redesignating clause (iii) as 

17 clause (ii). 

18 (B) Subparagraph (C) of section 

19 4041(b)(1) of such Code is amended by striking 

20 all that follows ‘‘section 6421(e)(2)’’ and insert21 ing a period. 

22 (C) Subsection (d) of section 4041 of such 

23 Code is amended by redesignating paragraph 

24 (3) as paragraph (4) and by inserting after 

25 paragraph (2) the following new paragraph: 
3

•S 251 IS 

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

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

3 liquid other than gasoline (as defined in section 

4 4083)—

5 ‘‘(A) sold by any person to an owner, les6 see, or other operator of a diesel-powered train 

7 for use as a fuel in such train, or 

8 ‘‘(B) used by any person as a fuel in a die9 sel-powered train unless there was a taxable 

10 sale of such fuel under subparagraph (A). 

11 No tax shall be imposed by this paragraph on the 

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

13 liquid under section 4081.’’. 

14 (D) Subsection (f) of section 4082 of such 

15 Code is amended by striking ‘‘section 

16 4041(a)(1)’’ and inserting ‘‘subsections (d)(3) 

17 and (a)(1) of section 4041, respectively’’. 

18 (E) Paragraph (3) of section 4083(a) of 

19 such Code is amended by striking ‘‘or a diesel20 powered train’’. 

21 (F) Paragraph (3) of section 6421(f) of 

22 such Code is amended to read as follows: 

23 ‘‘(3) GASOLINE USED IN TRAINS.—In the case 

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

25 shall not apply with respect to the Leaking Under-
4

•S 251 IS 

1 ground Storage Tank Trust Fund financing rate 

2 under section 4081.’’. 

3 (G) Paragraph (3) of section 6427(l) of 

4 such Code is amended to read as follows: 

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

6 USED IN DIESEL-POWERED TRAINS.—For purposes 

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

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

9 sentence shall not apply to the tax imposed by sec10 tion 4041(d) and the Leaking Underground Storage 

11 Tank Trust Fund financing rate under section 4081 

12 except with respect to fuel sold for exclusive use by 

13 a State or any political subdivision thereof.’’. 

14 (b) FUEL USED ON INLAND WATERWAYS.—

15 (1) IN GENERAL.—Paragraph (1) of section 

16 4042(b) of the Internal Revenue Code of 1986 (re17 lating to amount of tax) is amended by adding 

18 ‘‘and’’ at the end of subparagraph (A), by striking 

19 ‘‘, and’’ at the end of subparagraph (B) and insert20 ing a period, and by striking subparagraph (C). 

21 (2) CONFORMING AMENDMENT.—Paragraph (2) 

22 of section 4042(b) of such Code is amended by strik23 ing subparagraph (C). 
5

•S 251 IS 

1 (c) EFFECTIVE DATE.—The amendments made by 

2 this section shall take effect on January 1, 2003.

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