Amended in Assembly April 10, 2014

California Legislature—2013–14 Regular Session

Assembly Bill No. 2757

Introduced by Committee on Revenue and Taxation (Bocanegra (Chair), Gordon, Mullin, Pan, V. Manuel Pérez, and Ting)

March 24, 2014

An act to amend Sections 60501 and 60505.5 of the Revenue and Taxation Code, relating to taxation.

LEGISLATIVE COUNSEL’S DIGEST

AB 2757, as amended, Committee on Revenue and Taxation. Diesel Fuel Tax Law: reimbursements.

The Diesel Fuel Tax Law imposes a tax upon the removal, entry, sale, delivery, or specified use of diesel fuel, at a specified rate per gallon. That law provides for a reimbursement of the amount of that tax to persons who have used that tax-paid fuel in specified nontaxable uses, which is allowed through a claim for refund.

This bill would allow a claim for refund for amounts of tax paid on the biodiesel fuel portion of dyed blended biodiesel fuel removed from an approved terminal at the terminal rack, as provided, to the extent a supplier can show that the tax on that biodiesel fuel has been paid by the same supplier.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 60501 of the Revenue and Taxation Code
is amended to read:

60501.  

Persons who have paid a tax for diesel fuel lost, sold,
or removed as provided in paragraph (4) of subdivision (a), or used
in a nontaxable use, other than on a farm for farming purposes or
in an exempt bus operation, shall, except as otherwise provided in
this part, be reimbursed and repaid the amount of the tax.

(a) Except as otherwise provided in subdivision (b), a claim for
refund with respect to diesel fuel is allowed under this section only
if all of the following apply:

(1) Tax was imposed on the diesel fuel to which the claim
relates.

(2) The claimant bought or produced the diesel fuel and did not
sell or resell it in this state except as provided in paragraph (4).

(3) The claimant has filed a timely claim for refund that contains
the information required under subdivision (b) and the claim is
supported by the original invoice or original invoice facsimile
retained in an alternative storage media showing the purchase. If
no original invoice was created, electronic invoicing shall be
accepted as reflected by a computerized facsimile when
accompanied by an original copy of the bill of lading or fuel
manifest that can be directly tied to the electronic invoice.

(4) The diesel fuel was any of the following:

(A) Used for purposes other than operating motor vehicles upon
the public highways of the state.

(B) Exported for use outside of this state. Diesel fuel carried
from this state in the fuel tank of a motor vehicle is not deemed to
be exported from this state unless the diesel fuel becomes subject
to tax as an import under the laws of the destination state.

(C) Used in any construction equipment that is exempt from
vehicle registration pursuant to the Vehicle Code, while operated
within the confines and limits of a construction project.

(D) Used in the operation of a motor vehicle on any highway
that is under the jurisdiction of the United States Department of
Agriculture and with respect to the use of the highway the claimant
pays, or contributes to, the cost of construction or maintenance
thereof pursuant to an agreement with, or permission of, the United
States Department of Agriculture.

(E) Used in any motor vehicle owned by any county, city and
county, city, district, or other political subdivision or public agency
when operated by it over any highway constructed and maintained
by the United States or any department or agency thereof within
a military reservation in this state. If the motor vehicle is operated
both over the highway and over a public highway outside the
military reservation in a continuous trip the tax shall not be
refunded as to that portion of the diesel fuel used to operate the
vehicle over the public highway outside the military reservation.

Nothing contained in this section shall be construed as a refund
of the tax for the use of diesel fuel in any motor vehicle operated
upon a public highway within a military reservation, which
highway is constructed or maintained by this state or any political
subdivision thereof.

As used in this section, “military reservation” includes any
establishment of the United States Government or any agency
thereof used by the Armed Forces of the United States for military,
air, or naval operations, including research projects.

(F) Sold by a supplier and which was sold to any consulate
officer or consulate employee under circumstances which would
have entitled the supplier to an exemption under paragraph (6) of
subdivision (a) of Section 60100 if the supplier had sold the diesel
fuel directly to the consulate officer or consulate employee.

(G) Lost in the ordinary course of handling, transportation, or
storage.

(H) (i) Sold by a person to the United States and its agencies
and instrumentalities under circumstances that would have entitled
that person to an exemption from the payment of diesel fuel tax
under Section 60100 had that person been the supplier of this diesel
fuel.

(ii) Sold by a supplier and which was sold by credit card to the
United States and its agencies and instrumentalities under
circumstances which would have entitled the supplier to an
exemption under Section 60100 if the supplier had sold the diesel
fuel directly to the United States and its agencies and
instrumentalities.

(I) Sold by a person to a train operator for use in a
diesel-powered train or for other off-highway use under
circumstances that would have entitled that person to an exemption
from the payment of diesel fuel tax under Section 60100 had that
person been the supplier of this diesel fuel.

(J) Removed from an approved terminal at the terminal rack,
but only to the extent that the supplier can show that the tax on the
same amount of diesel fuel has been paid more than one time by
the same supplier.

(b) Where tax is not imposed on dyed blended biodiesel fuel
upon removal from an approved terminal at the terminal rack, if
tax was previously imposed on the biodiesel fuel portion of the
dyed blended biodiesel fuel begin delete upon entry into this state by nonbulk
transfer end delete , then, pursuant to paragraph (1) of subdivision (a), a claim
for refund is allowed for the tax that was paid on that biodiesel
fuel, but only to the extent a supplier can show that the tax on that
biodiesel fuel has been paid by the same supplier.

(c) Each claim for refund under this section shall contain the
following information with respect to all of the diesel fuel covered
by the claim:

(1) The name, address, telephone number, and permit number
of the person that sold the diesel fuel to the claimant and the date
of the purchase.

(2) A statement by the claimant that the diesel fuel covered by
the claim did not contain visible evidence of dye.

(3) A statement, which may appear on the invoice, original
invoice facsimile, or similar document, by the person that sold the
diesel fuel to the claimant that the diesel fuel sold did not contain
visible evidence of dye.

(4) The total amount of diesel fuel covered by the claim.

(5) The use made of the diesel fuel covered by the claim
described by reference to specific categories listed in paragraph
(4) of subdivision (a).

(6) If the diesel fuel covered by the claim was exported, a
statement that the claimant has the proof of exportation.

(d) Each claim for refund under this section shall be made on
a form prescribed by the board and shall be filed for a calendar
year. If, at the close of any of the first three quarters of the calendar
year, more than seven hundred fifty dollars ($750) is refundable
under this section with respect to diesel fuel used or exported
during that quarter or any prior quarter during the calendar year,
and for which no other claim has been filed, a claim may be filed
for the quarterly period. To facilitate the administration of this
section, the board may require the filing of claims for refund for
other than yearly periods.

SEC. 2.  

Section 60505.5 of the Revenue and Taxation Code
is amended to read:

60505.5.  

The claim for refund forms prescribed in subdivision
(d) of Section 60501 and subdivision (d) of Section 60502 may
include, but not be limited to, electronic media. The claim for
refund forms shall be authenticated in a form or pursuant to
methods as may be prescribed by the board.