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Timestamp: 2019-09-22 10:46:31
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PA Bulletin, Doc. No. 14-2591
Rates of Tax on Aviation Gasoline and Jet Fuel for 2015; Oil Company Franchise Tax Rate for 2015; Alternative Fuels Tax Rates for 2015
[44 Pa.B. 7799]
A. Aviation Gasoline Rate for 2015
Under 74 Pa.C.S. § 6121(b) (relating to tax on aviation fuels), the Secretary of Revenue (Secretary) announces that for calendar year 2015 the rate of tax on aviation gasoline and all other liquid fuels used or sold and delivered by distributors within this Commonwealth for use as fuel in propeller-driven piston engine aircraft or aircraft engines remains at the 2014 rate of 5.9¢1 per gallon or fractional part thereof.
B. Jet Fuel Rate for 2015
Under 74 Pa.C.S. § 6131(b) (relating to tax on jet fuels), the Secretary announces that for calendar year 2015 the rate of tax on jet fuels used or sold and delivered by distributors within this Commonwealth for use as fuel in turbine-propeller jet, turbojet and jet-driven aircraft and aircraft engines remains at the rate of 2.0¢ per gallon or fractional part thereof.
C. Calculating the 2015 Aviation Gasoline and Jet Fuel Rates
The rate of tax on jet fuels is adjusted annually beginning on January 1, 1986 and each January 1 thereafter. Under 74 Pa.C.S. §§ 6121(b) and 6131(b) the rate of each tax increases or decreases 0.1¢ per gallon for each 10% increase or decrease in the producer price index for jet fuel as determined by the U.S. Department of Labor, Bureau of Labor Statistics, for the most recent 12-month period available as of November 1, subject to a maximum rate of 6.0¢ per gallon for aviation gasoline and 2.0¢ per gallon for jet fuels.
On October 22, 2014, the most recently available 12-month period was September 2013 to September 2014, as reported in the Bureau of Labor Statistics, U.S. Department of Labor, Producer Price Index, September 2014, USDL-14-1940, released October 15, 2014, for which the percentage change was -2.2%. Accordingly, the 2015 aviation gasoline tax rate remains the same as the 2014 tax rate of 5.9¢ per gallon; the 2015 jet fuel tax rate will remain the same as the 2014 rate of 2.0¢ per gallon.
On November 25, 2013, Governor Corbett signed into law Act 89 of 2013 which amends Title 75 to both eliminate the inflationary cap on the Oil Company Franchise Tax and the fixed 12¢ per gallon Liquid Fuels and Fuels tax. Specifically, 75 Pa.C.S. § 9002 provides for the future removal of the cap and specific wholesale prices for use in the interim years. Accordingly, the statutorily fixed average wholesale price for 2015 is $2.49.
B. Calculating the 2015 Oil Company Franchise Tax Rate
As noted above, the average wholesale price of liquid fuels and fuels to be used in calculating the 2015 Oil Company Franchise tax rate shall be $2.49.
75 Pa.C.S. § 9502(a)(5) 49.0 49.0
Total Mills per Gallon: 202.5 257.5
Decimal Equivalent: .2025 .2575
Wholesale Price: x $2.49 x $2.49
Product: 50.42¢ 64.12¢
Highest tenth) 50.5¢ 64.2¢
The act of April 17, 1997 (P. L. 6, No. 3) provides that the oil company franchise tax as computed above is imposed when liquid fuels or fuels are used or sold and delivered in this Commonwealth. Accordingly, the tax imposed upon the use or sale and delivery of one gallon of liquid fuels (primarily gasoline) shall be 50.5¢, and the tax imposed upon the use or sale and delivery of one gallon of fuels (primarily undyed diesel fuel) shall be 64.2¢.
The Department recognizes the prevailing practice in private industry to adopt the ''diesel gallon equivalent'' or ''DGE'' for measuring Liquefied Natural Gas (LNG). Like the GGE, a DGE is a unit of measurement which is intended to compare the amount of energy content contained in a certain quantity of LNG to another form of energy, which for LNG, is most appropriately compared to diesel fuel. Industry standard conversions convey that 1.7 gallons of LNG would equal 1 DGE of LNG. Furthermore, because the industry practice utilizes the DGE when conveying the amount of LNG which has been dispensed to the consumer, it would be impractical for the Department to issue the tax rate on this alternative fuel in a different manner. Therefore, in accordance with industry standard practice, and consistent with the U.S. Department of Energy's conversion formula for LNG under the DGE standard, the 2015 tax rate for LNG shall be calculated using the DGE.
(Gaseous) GGE Equivalent
1 $.505
per DGE
LNG 1 $.642
[Pa.B. Doc. No. 14-2591. Filed for public inspection December 12, 2014, 9:00 a.m.]
1 The rate of 5.9¢ per gallon consists of 1.5¢ per gallon tax imposed by the Liquid Fuels and Fuels Tax Act, 75 Pa.C.S. § 9004(c)(1), and the 4.4¢ per gallon additional tax imposed by 74 Pa.C.S. § 6121(a), (b). As limited by 74 Pa.C.S. § 6121(b), the combined rate of these two component taxes may never exceed 6¢ per gallon or be less than 3¢ per gallon.