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(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to any sale, use, or removal for any pe-
riod after September 30, 2006.
PART II—AQUATIC EXCISE TAXES
SEC. 5211. ELIMINATION OF AQUATIC RESOURCES TRUST
FUND AND TRANSFORMATION OF SPORT FISH
RESTORATION ACCOUNT.
(a) SIMPLIFICATION OF FUNDING FOR BOAT SAFETY
ACCOUNT.—
(1) IN GENERAL.—Section 9503(c)(4) (relating
to transfers from Trust Fund for motorboat fuel taxes)
is amended—
(A) by striking ‘‘Fund—’’ and all that fol-
lows through ‘‘shall be transferred’’ in subpara-
graph (B) and inserting ‘‘Fund which is attrib-
utable to motorboat fuel taxes received on or
after October 1, 2005, and before October 1,
2011, shall be transferred’’,
(B) by striking subparagraph (A), and
(C) by redesignating subparagraphs (B)
through (E) as subparagraphs (A) through (D),
respectively.
(2) CONFORMING AMENDMENTS.—
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(A) Subparagraph (B) of section 9503(c)(4),
as 
redesignated 
by 
paragraph 
(1)(C), 
is
amended—
(i) by striking ‘‘ACCOUNT’’ in the head-
ing thereof and inserting ‘‘AND BOATING
TRUST FUND’’,
(ii) by striking ‘‘or (B)’’ in clause (ii),
and
(iii) by striking ‘‘account in the
Aquatic Resources’’ and inserting ‘‘and
Boating’’.
(B) Paragraph (5) of section 9503(c) is
amended by striking ‘‘Account in the Aquatic
Resources’’ in subparagraph (A) and inserting
‘‘and Boating’’.
(b) MERGING OF ACCOUNTS.—
(1) IN GENERAL.—Subsection (a) of section 9504
is amended to read as follows:
‘‘(a) CREATION OF TRUST FUND.—There is hereby es-
tablished in the Treasury of the United States a trust fund
to be known as the ‘Sport Fish Restoration and Boating
Trust Fund’. Such Trust Fund shall consist of such
amounts as may be appropriated, credited, or paid to it
as provided in this section, section 9503(c)(4), section
9503(c)(5), or section 9602(b).’’.
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(2) CONFORMING AMENDMENTS.—
(A) Subsection (b) of section 9504, as
amended by section 5001 of this Act, is
amended—
(i) by striking ‘‘ACCOUNT’’ in the head-
ing thereof and inserting ‘‘AND BOATING
TRUST FUND’’,
(ii) by striking ‘‘Account’’ both places
it appears in paragraphs (1) and (2) and
inserting ‘‘and Boating Trust Fund’’, and
(iii) by striking ‘‘ACCOUNT’’ both
places it appears in the headings for para-
graphs (1) and (2) and inserting ‘‘TRUST
FUND’’.
(B) Subsection (d) of section 9504, as
amended by section 5001 of this Act, is
amended—
(i) by striking ‘‘AQUATIC RESOURCES’’
in the heading thereof,
(ii) by striking ‘‘any Account in the
Aquatic Resources’’ in paragraph (1) and
inserting ‘‘the Sport Fish Restoration and
Boating’’, and
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(iii) by striking ‘‘any such Account’’
in paragraph (1) and inserting ‘‘such Trust
Fund’’.
(C) Subsection (e) of section 9504 is amend-
ed by striking ‘‘Boat Safety Account and Sport
Fish Restoration Account’’ and inserting ‘‘Sport
Fish Restoration and Boating Trust Fund’’.
(D) Section 9504 is amended by striking
‘‘AQUATIC RESOURCES’’ in the heading thereof
and inserting ‘‘SPORT
FISH
RESTORATION
AND BOATING’’.
(E) The item relating to section 9504 in the
table of sections for subchapter A of chapter 98
is amended by striking ‘‘aquatic resources’’ and
inserting ‘‘sport fish restoration and boating’’.
(c) PHASEOUT
OF BOAT SAFETY ACCOUNT.—Sub-
section (c) of section 9504 is amended to read as follows:
‘‘(c) EXPENDITURES FROM BOAT SAFETY ACCOUNT.—
Amounts remaining in the Boat Safety Account on October
1, 2005, and amounts thereafter credited to the Account
under section 9602(b), shall be available, without further
appropriation, for making expenditures before October 1,
2010, to carry out the purposes of section 15 of the Dingell-
Johnson Sport Fish Restoration Act (as in effect on the date
of the enactment of the Safe, Accountable, Flexible, and Ef-
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ficient Transportation Equity Act of 2005). For purposes
of section 9602, the Boat Safety Account shall be treated
as a Trust Fund established by this subchapter.’’.
(d) EFFECTIVE DATE.—The amendments made by this
section shall take effect on October 1, 2005.
SEC. 5212. REPEAL OF HARBOR MAINTENANCE TAX ON EX-
PORTS.
(a) IN GENERAL.—Subsection (d) of section 4462 (re-
lating to definitions and special rules) is amended to read
as follows:
‘‘(d) NONAPPLICABILITY OF TAX TO EXPORTS.—The
tax imposed by section 4461(a) shall not apply to any port
use with respect to any commercial cargo to be exported
from the United States.’’.
(b) CONFORMING AMENDMENTS.—
(1) Section 4461(c)(1) is amended by adding
‘‘or’’ at the end of subparagraph (A), by striking sub-
paragraph (B), and by redesignating subparagraph
(C) as subparagraph (B).
(2) Section 4461(c)(2) is amended by striking
‘‘imposed—’’ and all that follows through ‘‘in any
other case,’’ and inserting ‘‘imposed’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall take effect before, on, and after the date of the
enactment of this Act.
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SEC. 5213. CAP ON EXCISE TAX ON CERTAIN FISHING
EQUIPMENT.
(a) IN GENERAL.—Paragraph (1) of section 4161(a)
(relating to sport fishing equipment) is amended to read
as follows:
‘‘(1) IMPOSITION OF TAX.—
‘‘(A) IN
GENERAL.—There is hereby im-
posed on the sale of any article of sport fishing
equipment by the manufacturer, producer, or im-
porter a tax equal to 10 percent of the price for
which so sold.
‘‘(B) LIMITATION
ON
TAX
IMPOSED
ON
FISHING RODS AND POLES.—The tax imposed by
subparagraph (A) on any fishing rod or pole
shall not exceed $10.’’.
(b) CONFORMING AMENDMENTS.—Section 4161(a)(2)
is amended by striking ‘‘paragraph (1)’’ both places it ap-
pears and inserting ‘‘paragraph (1)(A)’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to articles sold by the manufacturer,
producer, or importer after September 30, 2005.
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PART III—AERIAL EXCISE TAXES
SEC. 5221. CLARIFICATION OF EXCISE TAX EXEMPTIONS
FOR AGRICULTURAL AERIAL APPLICATORS
AND EXEMPTION FOR FIXED-WING AIRCRAFT
ENGAGED IN FORESTRY OPERATIONS.
(a) NO WAIVER BY FARM OWNER, TENANT, OR OPER-
ATOR
NECESSARY.—Subparagraph 
(B) 
of 
section
6420(c)(4) (relating to certain farming use other than by
owner, etc.) is amended to read as follows:
‘‘(B) if the person so using the gasoline is
an aerial or other applicator of fertilizers or
other substances and is the ultimate purchaser of
the gasoline, then subparagraph (A) of this para-
graph shall not apply and the aerial or other ap-
plicator shall be treated as having used such gas-
oline on a farm for farming purposes.’’.
(b) EXEMPTION INCLUDES FUEL USED BETWEEN AIR-
FIELD AND FARM.—Section 6420(c)(4), as amended by sub-
section (a), is amended by adding at the end the following
new flush sentence:
‘‘In the case of an aerial applicator, gasoline shall be
treated as used on a farm for farming purposes if the
gasoline is used for the direct flight between the air-
field and 1 or more farms.’’.
(c) EXEMPTION FROM TAX ON AIR TRANSPORTATION
OF PERSONS FOR FORESTRY PURPOSES EXTENDED TO
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FIXED-WING AIRCRAFT.—Subsection (f) of section 4261 (re-
lating to tax on air transportation of persons) is amended
to read as follows:
‘‘(f) EXEMPTION FOR CERTAIN USES.—No tax shall be
imposed under subsection (a) or (b) on air transportation—
‘‘(1) by helicopter for the purpose of transporting
individuals, equipment, or supplies in the exploration
for, or the development or removal of, hard minerals,
oil, or gas, or
‘‘(2) by helicopter or by fixed-wing aircraft for
the purpose of the planting, cultivation, cutting, or
transportation of, or caring for, trees (including log-
ging operations),
but only if the helicopter or fixed-wing aircraft does not
take off from, or land at, a facility eligible for assistance
under the Airport and Airway Development Act of 1970,
or otherwise use services provided pursuant to section 44509
or 44913(b) or subchapter I of chapter 471 of title 49,
United States Code, during such use. In the case of heli-
copter transportation described in paragraph (1), this sub-
section shall be applied by treating each flight segment as
a distinct flight.’’.
(d) EFFECTIVE DATE.—The amendments made by this
section shall apply to fuel use or air transportation after
September 30, 2005.
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SEC. 5222. MODIFICATION OF RURAL AIRPORT DEFINITION.
(a) IN GENERAL.—Section 4261(e)(1)(B) (defining
rural airport) is amended—
(1) by inserting ‘‘(in the case of any airport de-
scribed in clause (ii)(III), on flight segments of at
least 100 miles)’’ after ‘‘by air’’ in clause (i), and
(2) by striking ‘‘or’’ at the end of subclause (I)
of clause (ii), by striking the period at the end of sub-
clause (II) of clause (ii) and inserting ‘‘, or’’, and by
adding at the end of clause (ii) the following new sub-
clause:
‘‘(III) is not connected by paved
roads to another airport.’’.
(b) EFFECTIVE DATE.—The amendments made by this
section shall take effect on October 1, 2005.
SEC. 5223. EXEMPTION FROM TAXES ON TRANSPORTATION
PROVIDED BY SEAPLANES.
(a) IN GENERAL.—Section 4261 (relating to imposi-
tion of tax) is amended by redesignating subsection (i) as
subsection (j) and by inserting after subsection (h) the fol-
lowing new subsection:
‘‘(i) EXEMPTION FOR SEAPLANES.—No tax shall be
imposed by this section or section 4271 on any air trans-
portation by a seaplane with respect to any segment con-
sisting of a takeoff from, and a landing on, water, but only
if the places at which such takeoff and landing occur have
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not received and are not receiving financial assistance from
the Airport and Airways Trust Fund.’’.
(b) EFFECTIVE DATE.—The amendments made by this
section shall apply to transportation beginning after Sep-
tember 30, 2005.
SEC. 5224. CERTAIN SIGHTSEEING FLIGHTS EXEMPT FROM
TAXES ON AIR TRANSPORTATION.
(a) IN GENERAL.—Section 4281 (relating to small air-
craft on nonestablished lines) is amended by adding at the
end the following new sentence: ‘‘For purposes of this sec-
tion, an aircraft shall not be considered as operated on an
established line at any time during which such aircraft is
being operated on a flight the sole purpose of which is sight-
seeing.’’.
(b) EFFECTIVE DATE.—The amendment made by this
section shall apply with respect to transportation beginning
after September 30, 2005, but shall not apply to any
amount paid before such date for such transportation.
PART IV—TAXES RELATING TO ALCOHOL
SEC. 5231. REPEAL OF SPECIAL OCCUPATIONAL TAXES ON
PRODUCERS AND MARKETERS OF ALCOHOLIC
BEVERAGES.
(a) REPEAL OF OCCUPATIONAL TAXES.—
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(1) IN GENERAL.—The following provisions of
part II of subchapter A of chapter 51 (relating to oc-
cupational taxes) are hereby repealed:
(A) Subpart A (relating to proprietors of
distilled spirits plants, bonded wine cellars, etc.).
(B) Subpart B (relating to brewer).
(C) Subpart D (relating to wholesale deal-
ers) (other than sections 5114 and 5116).
(D) Subpart E (relating to retail dealers)
(other than section 5124).
(E) Subpart G (relating to general provi-
sions) (other than sections 5142, 5143, 5145, and
5146).
(2) NONBEVERAGE DOMESTIC DRAWBACK.—Sec-
tion 5131 is amended by striking ‘‘, on payment of
a special tax per annum,’’.
(3) INDUSTRIAL USE OF DISTILLED SPIRITS.—
Section 5276 is hereby repealed.
(b) CONFORMING AMENDMENTS.—
(1)(A) The heading for part II of subchapter A
of chapter 51 and the table of subparts for such part
are amended to read as follows:
‘‘PART II—MISCELLANEOUS PROVISIONS
‘‘Subpart A. Manufacturers of stills.
‘‘Subpart B. Nonbeverage domestic drawback claimants.
‘‘Subpart C. Recordkeeping and registration by dealers.
‘‘Subpart D. Other provisions.’’.
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(B) The table of parts for such subchapter A is
amended by striking the item relating to part II and
inserting the following new item:
‘‘Part II. Miscellaneous provisions.’’.
(2) Subpart C of part II of such subchapter (re-
lating to manufacturers of stills) is redesignated as
subpart A.
(3)(A) Subpart F of such part II (relating to
nonbeverage domestic drawback claimants) is redesig-
nated as subpart B and sections 5131 through 5134
are redesignated as sections 5111 through 5114, re-
spectively.
(B) The table of sections for such subpart B, as
so redesignated, is amended—
(i) by redesignating the items relating to
sections 5131 through 5134 as relating to sec-
tions 5111 through 5114, respectively, and
(ii) by striking ‘‘and rate of tax’’ in the
item relating to section 5111, as so redesignated.
(C) Section 5111, as redesignated by subpara-
graph (A), is amended—
(i) by striking ‘‘AND RATE OF TAX’’ in
the section heading,
(ii) by striking the subsection heading for
subsection (a), and
(iii) by striking subsection (b).
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(4) Part II of subchapter A of chapter 51 is
amended by adding after subpart B, as redesignated
by paragraph (3), the following new subpart:
‘‘Subpart C—Recordkeeping and Registration by
Dealers
‘‘Sec. 5121. Recordkeeping by wholesale dealers.
‘‘Sec. 5122. Recordkeeping by retail dealers.
‘‘Sec. 5123. Preservation and inspection of records, and entry of premises for
inspection.
‘‘Sec. 5124. Registration by dealers.’’.
(5)(A) Section 5114 (relating to records) is
moved to subpart C of such part II and inserted after
the table of sections for such subpart.
(B) Section 5114 is amended—
(i) by striking the section heading and in-
serting the following new heading:
‘‘SEC. 5121. RECORDKEEPING BY WHOLESALE DEALERS.’’,
and
(ii) by redesignating subsection (c) as subsection
(d) and by inserting after subsection (b) the following
new subsection:
‘‘(c) WHOLESALE DEALERS.—For purposes of this
part—
‘‘(1) WHOLESALE
DEALER
IN
LIQUORS.—The
term ‘wholesale dealer in liquors’ means any dealer
(other than a wholesale dealer in beer) who sells, or
offers for sale, distilled spirits, wines, or beer, to an-
other dealer.
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‘‘(2) WHOLESALE DEALER IN BEER.—The term
‘wholesale dealer in beer’ means any dealer who sells,
or offers for sale, beer, but not distilled spirits or
wines, to another dealer.
‘‘(3) DEALER.—The term ‘dealer’ means any
person who sells, or offers for sale, any distilled spir-
its, wines, or beer.
‘‘(4) PRESUMPTION IN CASE OF SALE OF 20 WINE
GALLONS OR MORE.—The sale, or offer for sale, of dis-
tilled spirits, wines, or beer, in quantities of 20 wine
gallons or more to the same person at the same time,
shall be presumptive evidence that the person making
such sale, or offer for sale, is engaged in or carrying
on the business of a wholesale dealer in liquors or a
wholesale dealer in beer, as the case may be. Such
presumption may be overcome by evidence satisfac-
torily showing that such sale, or offer for sale, was
made to a person other than a dealer.’’.
(C) Paragraph (3) of section 5121(d), as so re-
designated, is amended by striking ‘‘section 5146’’
and inserting ‘‘section 5123’’.
(6)(A) Section 5124 (relating to records) is
moved to subpart C of part II of subchapter A of
chapter 51 and inserted after section 5121.
(B) Section 5124 is amended—
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(i) by striking the section heading and in-
serting the following new heading:
‘‘SEC. 5122. RECORDKEEPING BY RETAIL DEALERS.’’,
(ii) by striking ‘‘section 5146’’ in subsection (c)
and inserting ‘‘section 5123’’, and
(iii) by redesignating subsection (c) as subsection
(d) and inserting after subsection (b) the following
new subsection:
‘‘(c) 
RETAIL
DEALERS.—For 
purposes 
of 
this
section—
‘‘(1) RETAIL
DEALER
IN
LIQUORS.—The term
‘retail dealer in liquors’ means any dealer (other than
a retail dealer in beer or a limited retail dealer) who
sells, or offers for sale, distilled spirits, wines, or beer,
to any person other than a dealer.
‘‘(2) RETAIL DEALER IN BEER.—The term ‘retail
dealer in beer’ means any dealer (other than a lim-
ited retail dealer) who sells, or offers for sale, beer, but
not distilled spirits or wines, to any person other
than a dealer.
‘‘(3) LIMITED RETAIL DEALER.—The term ‘lim-
ited retail dealer’ means any fraternal, civic, church,
labor, charitable, benevolent, or ex-servicemen’s orga-
nization making sales of distilled spirits, wine or beer
on the occasion of any kind of entertainment, dance,
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picnic, bazaar, or festival held by it, or any person
making sales of distilled spirits, wine or beer to the
members, guests, or patrons of bona fide fairs, re-
unions, picnics, carnivals, or other similar outings, if
such organization or person is not otherwise engaged
in business as a dealer.
‘‘(4) DEALER.—The term ‘dealer’ has the mean-
ing given such term by section 5121(c)(3).’’.
(7) Section 5146 is moved to subpart C of part
II of subchapter A of chapter 51, inserted after section
5122, and redesignated as section 5123.
(8) Subpart C of part II of subchapter A of
chapter 51, as amended by paragraph (7), is amended
by adding at the end the following new section:
‘‘SEC. 5124. REGISTRATION BY DEALERS.
‘‘Every dealer who is subject to the recordkeeping re-
quirements under section 5121 or 5122 shall register with
the Secretary such dealer’s name or style, place of residence,
trade or business, and the place where such trade or busi-
ness is to be carried on. In case of a firm or company, the
names of the several persons constituting the same, and the
places of residence, shall be so registered.’’.
(9) Section 7012 is amended by redesignating
paragraphs (4) and (5) as paragraphs (5) and (6),
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respectively, and by inserting after paragraph (3) the
following new paragraph:
‘‘(4) For provisions relating to registration by
dealers in distilled spirits, wines, and beer, see section
5124.’’.
(10) Part II of subchapter A of chapter 51 is
amended by inserting after subpart C the following
new subpart:
‘‘Subpart D—Other Provisions
‘‘Sec. 5131. Packaging distilled spirits for industrial uses.
‘‘Sec. 5132. Prohibited purchases by dealers.’’.
(11) Section 5116 is moved to subpart D of part
II of subchapter A of chapter 51, inserted after the
table of sections, redesignated as section 5131, and
amended by inserting ‘‘(as defined in section
5121(c))’’ after ‘‘dealer’’ in subsection (a).
(12) Subpart D of part II of subchapter A of
chapter 51 is amended by adding at the end the fol-
lowing new section:
‘‘SEC. 5132. PROHIBITED PURCHASES BY DEALERS.
‘‘(a) IN GENERAL.—Except as provided in regulations
prescribed by the Secretary, it shall be unlawful for a dealer
to purchase distilled spirits for resale from any person other
than a wholesale dealer in liquors who is required to keep
the records prescribed by section 5121.
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‘‘(b) LIMITED RETAIL DEALERS.—A limited retail
dealer may lawfully purchase distilled spirits for resale
from a retail dealer in liquors.
‘‘(c) PENALTY AND FORFEITURE.—
‘‘For penalty and forfeiture provisions applicable to violations of subsection (a),
see sections 5687 and 7302.’’.
(13) Subsection (b) of section 5002 is amended—
(A) by striking ‘‘section 5112(a)’’ and in-
serting ‘‘section 5121(c)(3)’’,
(B) by striking ‘‘section 5112’’ and insert-
ing ‘‘section 5121(c)’’,
(C) by striking ‘‘section 5122’’ and insert-
ing ‘‘section 5122(c)’’.
(14) Subparagraph (A) of section 5010(c)(2) is
amended by striking ‘‘section 5134’’ and inserting
‘‘section 5114’’.
(15) Subsection (d) of section 5052 is amended
to read as follows:
‘‘(d) BREWER.—For purposes of this chapter, the term
‘brewer’ means any person who brews beer or produces beer
for sale. Such term shall not include any person who pro-
duces only beer exempt from tax under section 5053(e).’’.
(16) The text of section 5182 is amended to read
as follows:
‘‘For provisions requiring recordkeeping by wholesale liquor dealers, see sec-
tion 5112, and by retail liquor dealers, see section 5122.’’.
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(17) Subsection (b) of section 5402 is amended
by striking ‘‘section 5092’’ and inserting ‘‘section
5052(d)’’.
(18) Section 5671 is amended by striking ‘‘or
5091’’.
(19)(A) Part V of subchapter J of chapter 51 is
hereby repealed.
(B) The table of parts for such subchapter J is
amended by striking the item relating to part V.
(20)(A) Sections 5142, 5143, and 5145 are
moved to subchapter D of chapter 52, inserted after
section 5731, redesignated as sections 5732, 5733, and
5734, respectively, and amended by striking ‘‘this
part’’ each place it appears and inserting ‘‘this sub-
chapter’’.
(B) Section 5732, as redesignated by subpara-
graph (A), is amended by striking ‘‘(except the tax
imposed by section 5131)’’ each place it appears.
(C) Paragraph (2) of section 5733(c), as redesig-
nated by subparagraph (A), is amended by striking
‘‘liquors’’ both places it appears and inserting ‘‘to-
bacco products and cigarette papers and tubes’’.
(D) The table of sections for subchapter D of
chapter 52 is amended by adding at the end the fol-
lowing:
‘‘Sec. 5732. Payment of tax.
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‘‘Sec. 5733. Provisions relating to liability for occupational taxes.
‘‘Sec. 5734. Application of State laws.’’.
(E) Section 5731 is amended by striking sub-
section (c) and by redesignating subsection (d) as sub-
section (c).
(21) Subsection (c) of section 6071 is amended
by striking ‘‘section 5142’’ and inserting ‘‘section
5732’’.
(22) Paragraph (1) of section 7652(g) is
amended—
(A) by striking ‘‘subpart F’’ and inserting
‘‘subpart B’’, and
(B) by striking ‘‘section 5131(a)’’ and in-
serting ‘‘section 5111’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall take effect on July 1, 2008, but shall not apply
to taxes imposed for periods before such date.
SEC. 5232. MODIFICATION OF LIMITATION ON RATE OF RUM
EXCISE TAX COVER OVER TO PUERTO RICO
AND VIRGIN ISLANDS.
(a) IN GENERAL.—Section 7652(f)(1) (relating to lim-
itation on cover over of tax on distilled spirits) is amended
by inserting ‘‘, and $13.50 in the case of distilled spirits
brought into the United States after December 31, 2005,
and before January 1, 2007’’ after ‘‘2006’’.
(b) SPECIAL RULE.—
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(1) IN GENERAL.—After December 31, 2005, and
before January 1, 2007, the Commonwealth of Puerto
Rico shall make a Conservation Trust Fund transfer
from the treasury of Puerto Rico within 30 days from
the date of each cover overpayment to such treasury
under section 7652(e) of the Internal Revenue Code of
1986.
(2) CONSERVATION TRUST FUND TRANSFER.—
(A) IN GENERAL.—For purposes of this sub-
section, the term ‘‘Conservation Trust Fund
transfer’’ means a transfer to the Puerto Rico
Conservation Trust Fund of an amount equal to
50 cents per proof gallon of the taxes imposed
under section 5001 or section 7652 of such Code
on distilled spirits that are covered over to the
treasury of Puerto Rico under section 7652(e) of
such Code.
(B) TREATMENT OF TRANSFER.—Each Con-
servation Trust Fund transfer shall be treated as
principal for an endowment, the income from
which to be available for use by the Puerto Rico
Conservation Trust Fund for the purposes for
which the Trust Fund was established.
(C) RESULT OF NONTRANSFER.—