Highway Reauthorization and Excise Tax Simplification Act of 2005

Bill: 109-s-1230
Sponsor: Sen. Grassley, Chuck [R-IA]
Introduced: 2005-06-14 in the Senate
Policy area: Taxation
Subjects: Administrative procedure
Administrative remedies
Agricultural machinery
Agriculture and Food
Aircraft
Airports
Alabama
Alcohol as fuel
Alcohol tax
Alcoholic beverages
Arkansas
Automobile tires
Automobiles
Aviation fuels
Beer
Boats and boating
Bonds
Business records
Chief executive officers
Commerce
Commuting
Congress
Corporate debt
Corporation taxes
Corporations
Cost of living adjustments
Credit cards
Crime and Law Enforcement
Data banks
Department of the Treasury
Diesel motor
Economics and Public Finance
Electronic data interchange
Energy
Environmental Protection
Equipment and supplies
Excise tax
Exports
Farmers
Federal advisory bodies
Federal aid to transportation
Federal-state relations
Fertilizers
Finance and Financial Sector
Fines (Penalties)
Firearms
Fishing
Foreign Trade and International Finance
Foreign corporations
Foreign investments
Foreign tax credit
Forestry
Forfeiture
Fraud
Fringe benefits
Fuel consumption
Gasoline
Government Operations and Politics
Government paperwork
Government trust funds
Governmental investigations
Harbors
Highway finance
Highway use tax
Housing and Community Development
Illinois
Income tax
Indexing (Economic policy)
Interest
Intergovernmental tax relations
Kentucky
Labor and Employment
Law
Legislation
Louisiana
Marine engines
Marine safety
Mass rapid transit
Mississippi
Missouri
Motor buses
Nonprofit organizations
Pest control
Pesticides
Privatization
Public Lands and Natural Resources
Puerto Rico
Regional planning
Retail trade
Road construction
Science, Technology, Communications
Securities
Sentences (Criminal procedure)
Social Welfare
Sports and Recreation
Strategic planning
Tax administration
Tax credits
Tax evasion
Tax exclusion
Tax exemption
Tax havens
Tax penalties
Tax rates
Tax refunds
Tax returns
Taxation of foreign income
Tennessee
Toll roads
Tourism
Traffic congestion
Traffic engineering
Transportation and Public Works
Transportation planning
Travel costs
Trucks
Virgin Islands
Wholesale trade
Wine

Summary:
action_date: 2005-06-14
text: 
Highway Reauthorization and Excise Tax Simplification Act of 2005 - Amends the Internal Revenue Code to extend through FY2011 excise taxes for certain buses, special motor fuels, alcohol fuels, heavy trucks and trailers, tires, and certain taxable fuels.
 
 Extends through FY2009 expenditure authority for the Highway Trust Fund and the Aquatic Resources Trust Fund.
 
Revises or adds provisions relating to: (1) the gas guzzler excise tax; (2) the excise tax on certain fishing equipment; (3) excise tax exemptions for agricultural aerial applicators fixed-wing aircraft engaged in forestry operations; (4) excise tax exemptions for seaplane transportation and sightseeing flights; and (5) tax filing requirements for taxpayers with distilled spirit excise tax liability of not more than $50,000.
 
Repeals the special occupational tax on producers and marketers of alcoholic beverages. Revises or adds recordkeeping and registration requirements for wholesale and retail dealers of alcoholic beverages. 
 
Allows an income tax credit for the the cost of carrying federal excise taxes on distilled spirits.
 
Establishes a Motor Fuel Tax Enforcement Advisory Commission to review motor fuel revenue collections.
 
Establishes a National Surface Transportation Infrastructure Financing Commission.
 
Authorizes funding for studies of supplemental or alternative financing for the Highway Trust Fund.
 
Directs the Delta Regional Authority to conduct a study of the transportation assets and needs of states in the Delta region. 
 
Establishes the Build America Corporation as a nonprofit, nongovernment corporation for the purpose of issuing Build America bonds to finance certain highway and transportation projects. 
 
Adds or increases penalties for: (1) frivolous tax submissions; (2) tax fraud and false statements; and (3) underpayments of tax resulting from certain offshore financial arrangements.
 
Requires chief executive officers of corporations to independently verify annual corporate income tax returns.

action_date: 2005-06-14
text: 

(This measure has not been amended since it was introduced. The summary has been expanded because action occurred on the measure.)

 
Highway Reauthorization and Excise Tax Simplification Act of 2005 - 
Title I: Trust Fund Reauthorization 
- (Sec. 101) Amends the Internal Revenue Code to extend through FY2011: (1) the 7.3 cents per gallon excise tax rate on fuel for certain buses; (2) the increased tax rate for special motor fuels; (3) the increased tax rate for methanol or ethanol fuel; (4) the excise tax on heavy trucks and trailers sold at retail; (5) the excise tax on tires; (6) the increased tax rate for gasoline, diesel fuel, and kerosene; (7) the highway motor vehicle use tax; (8) the period for floor stock refunds for taxes on tires and certain taxable fuels; (9) the exemption from tax for certain tax-free sales and for use of certain heavy vehicles; and (10) the authority for transfers of motorboat and small-engine fuel taxes from the Highway Trust Fund to the Aquatic Resources Trust Fund. 
 
Extends through FY2009 expenditure authority for the Highway Trust Fund and the Aquatic Resources Trust Fund. 
 
(Sec. 102) Extends from 24 to 48 months the period for estimating net highway tax receipts for purposes of adjusting apportionments to states for federal highway-aid programs. 
 

Title II: Excise Tax Reform and Simplification
 - 
Subtitle A: Highway Excise Taxes
 (Sec. 201) Exempts limousines with a gross vehicle weight greater than 6,000 pounds from the gas guzzler tax.
 

Subtitle B: Aquatic Excise Taxes
 (Sec. 211) Eliminates the authority for transfers to the Boat Safety Account in the Aquatic Resources Trust Fund and phases out future transfers to such Account through FY2010. 
 
Establishes in the Treasury the Sport Fish Restoration and Boating Trust Fund.
 
(Sec. 212) Exempts commercial cargo exported from the United States from the harbor maintenance tax. 
 
(Sec. 213) Limits the excise tax on fishing rods or poles to the lesser of 10 percent or $10.
 

Subtitle C: Aerial Excise Taxes 
(Sec. 221) Provides that an aerial applicator of agricultural fertilizer or other substances who is the ultimate purchaser of gasoline used on farms may qualify for an excise tax exemption for such gasoline without the necessity of a waiver by farm owners, operators, or tenants of their right to be treated as users and ultimate purchasers of such gasoline. Includes within such tax exemption gasoline used for the direct flight between the airfield and one or more farms.
 
Exempts fixed-wing aircraft used for forestry purposes from the passenger air transportation tax unless such aircraft uses federally-funded airports and airway services.
 
(Sec. 222) Expands the definition of rural airport for purposes of the air transportation tax to include an airport that is not connected by paved roads to another airport. Exempts from such tax: (1) transportation by seaplanes that do not use airports receiving assistance from the Airport and Airways Trust Fund; and (2) certain sightseeing aircraft.
 

Subtitle D: Taxes Relating to Alcohol
 (Sec.231) Repeals the special occupational taxes on producers and marketers of alcoholic beverages and on the nonbeverage or industrial use of distilled spirits. Revises and adds registration, recordkeeping, and inspection requirements applicable to wholesale and retail dealers of distilled spirits.
 
(Sec. 232) Extends until January 1, 2007, and increases from $13.25 to $13.50 per proof gallon, the amount of excise tax on distilled spirits required to be paid back (covered) to the Treasuries of Puerto Rico and the Virgin Islands. Requires Puerto Rico to transfer a portion of the amount paid back to the Puerto Rico Conservation Trust Fund.
 
(Sec. 233) Allows certain wholesalers, distillers, and importers of distilled spirits an income tax credit for the average carrying costs of the excise tax on distilled spirits. 
 
(Sec. 234) Permits taxpayers with distilled spirit tax liabilities of not more than $50,000 to file quarterly tax reports (instead of semimonthly reports).
 

Subtitle E: Sport Excise Taxes
 (Sec. 241) Exempts from the firearms excise tax taxpayers who manufacture, produce, or import less than 50 pistols, revolvers, or firearms annually. 
 

Title III: Miscellaneous Provisions 
- (Sec. 301) Establishes a Motor Vehicle Fuel Tax Enforcement Advisory Commission to assist in the administration of motor vehicle fuel excise taxes. Authorizes the Commission to obtain data directly from any U.S. agency or department. Terminates the Commission on September 30, 2009. 
 
(Sec. 302) Establishes a National Surface Transportation Infrastructure Financing Commission to study the funding of, and alternative approaches to generating revenues for, the Highway Trust Fund. Authorizes the Commission to obtain data directly from any U.S. agency. Directs the Commission to submit a final report to the Secretaries of Transportation and the Treasury and to specified congressional committees within two years of its first meeting.
 
(Sec. 303) Authorizes expenditures from the Highway Trust Fund for two comprehensive studies of supplemental or alternative funding sources for the Highway Trust Fund. 
 
(Sec. 304) Directs the Delta Regional Authority to study the transportation assets and needs of states in the Delta region (i.e., Alabama, Arkansas, Illinois, Kentucky, Louisiana, Mississippi, Missouri, and Tennessee).
 
(Sec. 305) Establishes the Build America Corporation as a nonprofit and nongovernmental agency to issue Build America bonds. Authorizes the use of Build America bond proceeds to fund certain qualified projects, including highway projects, public transportation projects, and congestion relief projects.
 
(Sec. 306) Increases the tax exclusion for transportation and parking employee benefits of employees. Adjusts such exclusion amounts for inflation after 2008.
 

Title IV: Fuels-Related Technical Corrections
 - (Sec. 401) Makes technical corrections to: (1) the American Jobs Creation Act of 2004 relating to refunds for excise tax on certain alcohol fuels and the termination date for the 21.8-cent per gallon rate for noncommercial aviation jet fuel; and (2) the Transportation Equity Act for the 21st Century.
 

Title V: Revenue Offset Provisions 
- (Sec. 501) Sets forth a special rule for the treatment of contingent payment convertible debt instruments. 
 
(Sec. 502) Imposes increased penalties for frivolous tax submissions. Defines &quot;submissions&quot; to include requests for collection due process hearings, installment agreements, offers in compromise, or taxpayer assistance orders. Permits taxpayers to withdraw frivolous tax submissions without penalty.
 
(Sec. 503) Increases criminal penalties for attempts to evade or defeat tax, willful failure to file tax returns, supply information, or pay tax, and fraud and false statements.
 
(Sec. 504) Doubles tax penalties, fines, and interest for underpayments of tax related to certain offshore financial arrangements.
 
(Sec. 505) Exempts U.S. shareholders of controlled foreign corporations from the application of certain passive foreign investment company rules where such corporations earn subpart F income and there is only a remote likelihood that subpart F income will be included in the gross income of such shareholders.
 
(Sec. 506) Requires that the federal income tax return of a corporation include a declaration signed by the chief executive officer of such corporation, under penalty of perjury, that the corporation has procedures in place to ensure that its return complies with tax law, and that the chief executive officer was provided with reasonable assurance of the accuracy of such return.
 
(Sec. 507) Authorizes the Secretary of the Treasury to prescribe regulations disallowing or allocating the foreign tax credit under circumstances involving an inappropriate separation of foreign taxes from the related foreign income. 


Legislative actions:
action_date: 2005-06-14
text: Placed on Senate Legislative Calendar under General Orders. Calendar No. 127.
action_date: 2005-06-14
text: Committee on Finance. Original measure reported to Senate by Senator Grassley. With written report No. 109-82.
action_date: 2005-06-14
text: Committee on Finance. Original measure reported to Senate by Senator Grassley. With written report No. 109-82.
action_date: 2005-06-14
text: Introduced in Senate
action_date: 2005-04-19
text: Committee on Finance. Ordered to be reported without amendment favorably.