Airport and Airway Trust Fund Tax Reinstatement Act of 1997
PL 105-2 (H.R.668), enacted 02/28/1997

I l l STAT. 4 
PUBLIC LAW 105-2—FEB. 28, 1997 
Public Law 105-2 
105th Congress 
An Act 
Feb. 28, 1997 
[H.R. 668] 
Airport and 
Airway Trust 
Fund Tax 
Reinstatement 
Act of 1997. 
26 u s e 1 note. 
26 u s e 1 et seq. 
To amend the Internal Revenue Code of 1986 to reinstate the Airport and Airway 
Trust Fund excise taxes, and for other purposes. 
Be it enacted by the Senate and House of Representatives 
of 
the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE. 
(a) SHORT TITLE.—This Act may be cited as the "Airport and 
Airway Trust Fund Tax Reinstatement Act of 1997". 
(b) AMENDMENT OF 1986 CODE.—Except as otherwise expressly 
provided, whenever in this Act an amendment or repeal is expressed 
in terms of an amendment to, or repeal of, a section or other 
provision, the reference shall be considered to be made to a section 
or other provision of the Internal Revenue Code of 1986. 
SEC. 2. REINSTATEMENT OF AIRPORT AND AIRWAY TRUST FUND 
EXCISE TAXES. 
(a) FUEL TAXES.— 
(1) AVIATION FUEL.—Subparagraph (A) of section 4091(b)(3) 
is amended to read as follows: 
"(A) The rate of tax specified in paragraph (1) shall 
be 4.3 cents per gallon— 
"(i) after December 31, 1996, and before the date 
which is 7 days after the date of the enactment of 
the Airport and Airway Trust Fund Tax Reinstatement 
Act of 1997, and 
"(ii) after September 30, 1997.". 
(2) AVIATION GASOLINE.—Subsection (d) of section 4081 is 
amended by striking the paragraph (3) added by section 1609(a) 
of the Small Business Job Protection Act of 1996 and by striking 
paragraphs (1) and (2) and inserting the following new para-
graphs: 
"(1) IN GENERAL.—The rates of tax specified in clauses 
(i) and (iii) of subsection (a)(2)(A) shall be 4.3 cents per gallon 
after September 30, 1999. 
"(2) AVIATION GASOLINE.—The rate of tax specified in sub-
section (a)(2)(A)(ii) shall be 4.3 cents per gallon— 
"(A) after December 31, 1996, and before the date 
which is 7 days after the date of the enactment of the 
Airport and Airway Trust Fund Tax Reinstatement Act 
of 1997, and 
"(B) after September 30, 1997.". 
(3) NONCOMMERCIAL AVIATION.—Paragraph (3) of section 
4041(c) is amended to read as follows: 
PUBLIC LAW 105-2—FEB. 28, 1997 
111 STAT. 5 
"(3) TERMINATION.—The rate of the t£ixes imposed by para-
graph (1) shall be 4.3 cents per gallon— 
"(A) after December 31, 1996, and before the date 
which is 7 days after the date of the enactment of the 
Airport and Airway Trust Fund Tax Reinstatement Act 
of 1997, and 
"(B) after September 30, 1997.". 
(b) TICKET TAXES.— 
(1) PERSONS.—Subsection (g) of section 4261 is amended 
to read as follows: 
"(g) APPLICATION OF TAXES.— 
"(1) IN GENERAL.—^The taxes imposed by this section shall 
apply to— 
"(A) transportation beginning during the period— 
"(i) beginning on the 7th day after the date of 
the enactment of the Airport and Airway Trust Fund 
Tax Reinstatement Act of 1997, and 
"(ii) ending on September 30, 1997, and 
"(B) amounts paid during such period for transpor-
tation beginning after such period. 
"(2) REFUNDS.—If, as of the date any transportation begins, 
the taxes imposed by this section would not have applied to 
such transportation if paid for on such date, any tax paid 
under paragraph (1)(B) with respect to such trsmsportation 
shall be treated as an overpayment.". 
(2) PROPERTY.—Subsection (d) of section 4271 is amended 
to read as follows: 
"(d) APPLICATION OF TAX.— 
"(1) IN GENERAL.—The tax imposed by subsection (a) shall 
apply to— 
"(A) transportation beginning during the period— 
"(i) beginning on the 7th day after the date of 
the enactment of the Airport and Airway Trust Fund 
Tax Reinstatement Act of 1997, £ind 
"(ii) ending on September 30, 1997, and 
"(B) amounts paid during such period for transpor-
tation beginning after such period. 
"(2) REFUNDS.—If, as of the date any transportation begins, 
the taxes imposed by this section would not have applied to 
such transportation if paid for on such date, any tax paid 
under paragraph (1)(B) with respect to such transportation 
shall be treated as an overpayment.". 
(c) TRANSFERS TO AIRPORT AND AIRWAY TRUST FUND.— 
(1) IN GENERAL.—Subsection (b) of section 9502 is amended 
to read as follows: 
"(b) TRANSFERS TO AIRPORT AND AIRWAY TRUST FUND.—There Appropriation 
are hereby appropriated to the Airport and Airway Trust Fund authorization, 
amounts equivalent to— 
"(1) the taxes received in the Treasury under— 
"(A) subsections (c) and (e) of section 4041 (relating 
to aviation fuels), 
"(B) sections 4261 and 4271 (relating to transportation 
by air), 
"(C) section 4081 (relating to gasoline) with respect 
to aviation gasoline (to the extent that the rate of the 
tax on such gasoline exceeds 4.3 cents per gallon), and 
I l l STAT. 6 
PUBLIC LAW 105-2—FEB. 28, 1997 
"(D) section 4091 (relating to aviation fuel) to the 
extent attributable to the Airport and Airway Trust Fund 
financing rate, and 
"(2) the amounts determined by the Secretary of the Treas-
ury to be equivalent to the amounts of civil penalties collected 
under section 47107(n) of title 49, United States Code.". 
(2) TERMINATION OF FINANCING RATE.—Paragraph (3) of 
section 9502(f) is amended to read as follows: 
"(3) TERMINATION.—Notwithstanding the preceding provi-
sions of this subsection, the Airport and Airway Trust Fund 
financing rate shall be zero with respect to taxes imposed 
during any period that the rate of the tax imposed by section 
4091(b)(1) is 4.3 cents per gallon.". 
26 use 4081 
(d) FLOOR STOCKS TAXES ON AVIATION GASOLINE AND AVIATION 
note. 
FUEL.— 
(1) IMPOSITION OF TAX.—In the case of any aviation liquid 
on which tax was imposed under section 4081 or 4091 of the 
Internal Revenue Code of 1986 before the tax effective date 
and which is held on such date by any person, there is hereby 
imposed a floor stocks tax o
f
— 
(A) 15 cents per gallon in the case of aviation gasoline, 
and 
(B) 17.5 cents per gallon in the case of aviation fuel. 
(2) LIABILITY FOR TAX AND METHOD OF PAYMENT.— 
(A) LIABILITY FOR TAX.—A person holding, on the tax 
effective date, any aviation liquid to which the tax imposed 
by paragraph (1) applies shall be liable for such tax. 
(B) METHOD OF PAYMENT.—The tax imposed by para-
graph (1) shall be paid in such manner as the Secretary 
shall prescribe. 
(C) TIME FOR PAYMENT.—The tax imposed by para-
graph (1) shall be paid on or before the first day of the 
5th month beginning after the tax effective date. 
(3) DEFINITIONS.—For purposes of this subsection— 
(A) TAX EFFECTIVE DATE.—The term "tax effective date" 
? 
means the date which is 7 days after the date of the 
enactment of this Act. 
(B) AVIATION 
LIQUID.—The term "aviation liquid" 
means aviation gasoline and aviation fuel. 
(C) AVIATION GASOLINE.—The term "aviation gasoline" 
has the meaning given such term in section 4081 of such 
Code. 
(D) AVIATION FUEL.—The term "aviation fuel" has the 
meaning given such term by section 4093 of such Code. 
(E) HELD BY A PERSON.—^Aviation liquid shall be consid-
ered as "held by a person" if title thereto has passed 
to such person (whether or not delivery to the person 
has been made). 
(F) SECRETARY.—The term "Secretary" means the 
Secretary of the Treasury or the Secretary's delegate. 
(4) EXCEPTION FOR EXEMPT USES.—The tax imposed by 
paragraph (1) shall not apply to— 
(A) aviation liquid held by any person on the tax effec-
tive date exclusively for any use for which a credit or 
refund of the entire tax imposed by section 4081 or 4091 
of such Code (as the case may be) is allowable for such 
PUBLIC LAW 105-2—FEB. 28, 1997 
111 STAT. 7 
liquid purchased on or after such tax effective date for 
such use, or 
(B) aviation fuel held by any person on the tax effective 
date exclusively for any use described in section 4092(b) 
of such Code. 
(5) EXCEPTION FOR CERTAIN AMOUNTS OF FUEL.— 
(A) IN GENERAL.—No tax shall be imposed by para-
graph (1) on any aviation liquid held on the tax effective 
date by any person if the aggregate amount of such liquid 
(determined separately for aviation gasoline and aviation 
fuel) held by such person on such date does not exceed 
2,000 gallons. The preceding sentence shall apply only if Applicability, 
such person submits to the Secretary (at the time and 
in the manner required by the Secretary) such information 
as the Secretary shall require for purposes of this para-
graph. 
(B) EXEMPT FUEL.—Any liquid to which the tax 
imposed by paragraph (1) does not apply by reason of 
paragraph (4) shall not be taken into account under 
subparagraph (A). 
(C) CONTROLLED GROUPS.—For purposes of this para-
graph— 
(i) CORPORATIONS.— 
(I) IN GENERAL.—^All persons treated as a con-
trolled group shall be treated as 1 person. 
(II) 
CONTROLLED GROUP.—The term "con-
trolled group" has the meaning given such term 
by subsection (a) of section 1563 of such Code; 
except that for such purposes, the phrase "more 
than 50 percent" shall be substituted for the 
phrase "at least 80 percent" each place it appears 
in such subsection. 
(ii) NONINCORPORATED PERSONS UNDER COMMON 
CONTROL.—Under 
regulations 
prescribed 
by the 
Secretary, principles similar to the principles of clause 
(i) shall apply to a group of persons under common 
control where 1 or more of such persons is not a 
corporation. 
(6) OTHER LAWS APPLICABLE.—All provisions of law, includ-
ing penalties, applicable with respect to the taxes imposed 
by section 4081 or 4091 of such Code shall, insofar as applicable 
and not inconsistent with the provisions of this subsection, 
apply with respect to the floor stocks taxes imposed by para-
graph (1) to the same extent as if such taxes were imposed 
by such section 4081 or 4091, as the case may be. 
(e) EFFECTIVE DATES.— 
(1) FUEL TAXES.—The amendments made by subsection 
(a) shall apply to periods beginning on or after the 7th day 
after the date of the enactment of this Act. 
(2) TICKET TAXES.— 
(A) IN GENERAL.—The amendments made by subsection 
(b) shall apply to transportation beginning on or after 
such 7th day. 
(B) EXCEPTION FOR CERTAIN PAYMENTS.—Except as 
provided in subparagraph (C), the amendments made by 
subsection (b) shall not apply to any amount paid before 
such 7th day. 
Regulations. 
Applicability. 
26 use 4041 
note. 
26 use 4261 
note. 
Ill STAT. 8 
PUBLIC LAW 105-2—FEB. 28, 1997 
(C) 
PAYMENTS 
OF 
PROPERTY 
TRANSPORTATION 
TAX 
WITHIN CONTROLLED GROUP.—In the case of the tax imposed 
by section 4271 of the Internal Revenue Code of 1986, 
subparagraph (B) shall not apply to any amount paid by 
1 member of a controlled group for transportation furnished 
by another member of such group. For purposes of the 
preceding sentence, all persons treated as a single employer 
under subsection (a) or (b) of section 52 of the Internal 
Revenue Code of 1986 shall be treated as members of 
a controlled group. 
(f) APPLICATION OF LOOK-BACK SAFE HARBOR FOR DEPOSITS.— 
Nothing in the look-back safe harbor prescribed in Treasury Regula-
tion section 40.6302(c)-l(c)(2) shall be construed to permit such 
safe harbor to be used with respect to any tax unless such tax 
was imposed throughout the look-back period. 
Approved February 28, 1997. 
L E G I S L A T I V E H I S T O R Y — H . R . 668 (S. 
279): 
HOUSE REPORTS: No. 105-5 (Comm. on Ways and Means). 
SENATE REPORTS: No. 105-4 accompanying S. 279 (Comm. on Finance). 
CONGRESSIONAL RECORD, Vol. 143 (1997): 
Feb. 25, 26, considered and passed House. 
Feb. 27, considered and passed Senate.