2023 Texas Statutes › Tax Code › Title 2 - State Taxation › Subtitle E - Sales, Excise, and Use Taxes › Chapter 162 - Motor Fuel Taxes › Subchapter C. Diesel Fuel Tax › Section 162.206. Statement for Purchase of Dyed Diesel Fuel

Sec. 162.206.  STATEMENT FOR PURCHASE OF DYED DIESEL FUEL.  (a)  The first removal of diesel fuel from a terminal in this state is taxable, except the sale of dyed diesel fuel may be made without collecting the tax if the purchaser furnishes to a licensed supplier or distributor a signed statement that includes an end user number issued by the comptroller.  A person who wants to use a signed statement to purchase dyed diesel fuel must apply to the comptroller for an end user number to be used in conjunction with a signed statement.  A licensed supplier or distributor may not make a tax-free sale of any diesel fuel to a purchaser using a signed statement unless the purchaser has an end user number issued by the comptroller under this section.  A taxable sale or removal of dyed diesel fuel may not be made under this chapter, except as prescribed by Subsection (d).
(b)  A sale of dyed diesel fuel may be made without collecting the tax if the purchaser furnishes to a licensed supplier or distributor a signed statement, including an end user number issued by the comptroller, that stipulates that:
(1)  all of the dyed diesel fuel purchased on the signed statement will be consumed by the purchaser and will not be resold;  and
(2)  none of the dyed diesel fuel purchased on the signed statement will be delivered or permitted to be delivered into the fuel supply tank of a motor vehicle operated on the public highways of this state.
(c)  A person may not make a tax-free purchase and a licensed supplier or distributor may not make a tax-free sale to a purchaser of any dyed diesel fuel under this section using a signed statement for the first sale or purchase and for any subsequent sale or purchase  in a calendar month for more than:
(1)  10,000 gallons of dyed diesel fuel;
(2)  25,000 gallons of dyed diesel fuel if the purchaser stipulates in the signed statement that all of the fuel will be consumed by the purchaser in the original production of, or to increase the production of, oil or gas and furnishes the licensed supplier or distributor with a letter of exception issued by the comptroller; or
(3)  25,000 gallons of dyed diesel fuel if the purchaser stipulates in the signed statement that all of the fuel will be consumed by the purchaser in agricultural off-highway equipment.
(c-1)  The monthly limitations prescribed by Subsection (c) apply regardless of whether the dyed diesel fuel is purchased in a single transaction during that month or in multiple transactions during that month.
(d)  Any gallons purchased or sold in excess of the limitations prescribed by Subsection (c) constitute a taxable purchase or sale.   A purchaser that exceeds the limitations prescribed by Subsection (c) shall be required to obtain a dyed diesel fuel bonded user license.
(e)  The signed statement and end user number from the purchaser relieves the licensed supplier or distributor from the burden of proof that the sale of dyed diesel fuel for a nonhighway purpose was not taxable to the purchaser and remains in effect unless:
(1)  the statement is revoked in writing by the purchaser or licensed supplier or distributor;
(2)  the comptroller notifies the licensed supplier or distributor in writing that the purchaser may no longer make tax-free purchases;  or
(3)  the licensed supplier or distributor is put on notice by making taxable sales of dyed diesel fuel to a purchaser who has previously furnished a signed statement to the licensed supplier or distributor.
(f)  For purposes of Subsection (e)(3), a licensed supplier or distributor is not put on notice when taxable sales of dyed diesel fuel are made in accordance with Subsection (d).
(g)  The statement must be signed by the purchaser or the purchaser's representative.
(g-1)  For purposes of this section, the purchaser is considered to have temporarily furnished the signed statement to the licensed supplier or distributor if the supplier or distributor verifies that the purchaser has an end user number issued by the comptroller.  The licensed supplier or distributor shall use the comptroller's Internet website or other materials provided or produced by the comptroller to verify this information until the purchaser provides to the supplier or distributor a completed signed statement.
(h)  The comptroller by rule may allow separate operating divisions of a corporation to give separate signed statements as if the divisions were different legal entities.
(i)  The comptroller may adopt necessary forms and rules to administer and enforce this section.
(j)  A taxable use of any part of the dyed diesel fuel purchased under a signed statement shall, in addition to application of any criminal penalty, forfeit the right of the person to purchase dyed diesel fuel tax-free for a period of one year from the date of the offense.  Any tax, interest, and penalty found to be due through false or erroneous execution or continuance of a promissory statement by the purchaser, if assessed to the licensed supplier or distributor, is a debt of the purchaser to the licensed supplier or distributor until paid and is recoverable at law in the same manner as the purchase price of the fuel.
(k)  Properly completed signed statements should be in the possession of the licensed supplier or distributor at the time the sale of dyed diesel fuel occurs.  If the licensed supplier or distributor is not in possession of the signed statements within 60 days after the date written notice requiring possession of them is given to the licensed supplier or distributor by the comptroller, exempt sales claimed by the licensed supplier or distributor that require delivery of the signed statements shall be disallowed.  If the licensed supplier or distributor delivers the signed statements to the comptroller within the 60-day period, the comptroller may verify the reason or basis for the signed statements before allowing the exempt sales.  An exempt sale may not be granted on the basis of signed statements delivered to the comptroller after the 60-day period.
(l)  On receipt of notice transmitted by an electronic means of a final judgment entered by a court against a purchaser of dyed diesel fuel for failure to pay an amount owed to a licensed supplier or distributor for the purchase of dyed diesel fuel, the comptroller shall revoke the end user number issued to the purchaser.  The comptroller shall provide the notice described by Subsection (e)(2) to the licensed supplier or distributor if the purchaser's end user number is revoked.
(m)  The comptroller may reinstate an end user number that is revoked under Subsection (l) on receipt of proof transmitted by an electronic means and satisfactory to the comptroller that the purchaser whose end user number was revoked has satisfied the judgment described by Subsection (l), including all costs and other amounts awarded in the judgment.
Added by Acts 2003, 78th Leg., ch. 199, Sec. 1, eff. Jan. 1, 2004.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 1227 (S.B. 1495), Sec. 23, eff. September 1, 2009.
Acts 2013, 83rd Leg., R.S., Ch. 435 (S.B. 603), Sec. 1, eff. September 1, 2013.