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Senate Study Bill 1246 - IntroducedA Bill ForAn Act 1relating to the excise taxes on motor fuel and certain
2special fuel.
3BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 452A.3, subsections 1, 2, 3, 4, 5, and 6,
2Code 2019, are amended to read as follows:
31. Except as otherwise provided in this section and in this
4subchapter, until June 30, 2020, this subsection shall apply
5to the excise tax imposed on each gallon of motor fuel used for
6any purpose for the privilege of operating motor vehicles in
7this state.
8a. An excise tax of thirty cents is imposed on each gallon
9of motor fuel other than ethanol blended gasoline classified
10as E-15 or higher.
11a. b. The rate of the excise tax on ethanol blended
12gasoline classified as E-15 or higher shall be based on the
13number of gallons of ethanol blended gasoline classified
14as E-15 or higher that is are distributed in this state as
15expressed as a percentage of the number of gallons of motor
16fuel distributed in this state, which is referred to as the
17distribution percentage. For purposes of this subsection
18 paragraph, only ethanol blended gasoline and nonblended
19gasoline, not including aviation gasoline, shall be used in
20determining the percentage basis for the excise tax. The
21department shall determine the percentage basis for each
22determination period beginning January 1 and ending December
2331. The rate for the excise tax shall apply for the period
24beginning July 1 and ending June 30 following the end of the
25determination period. The rate of the excise tax on each
26gallon of ethanol blended gasoline classified as E-15 or higher
27shall be as follows:
28b. The rate for the excise tax shall be as follows:
29(1) If the distribution percentage is not greater than fifty
30 ten percent, the rate shall be twenty-nine twenty-four cents
31for ethanol blended gasoline and thirty cents for motor fuel
32other than ethanol blended gasoline.
33(2) If the distribution percentage is greater than fifty
34 ten percent but not greater than fifty-five twelve percent, the
35rate shall be twenty-nine twenty-four and five-tenths cents for
-1-1ethanol blended gasoline and thirty and one-tenth cents for
2motor fuel other than ethanol blended gasoline.
3(3) If the distribution percentage is greater than
4fifty-five twelve percent but not greater than sixty fourteen
5 percent, the rate shall be twenty-nine twenty-five cents for
6ethanol blended gasoline and thirty and three-tenths cents for
7motor fuel other than ethanol blended gasoline.
8(4) If the distribution percentage is greater than sixty
9 fourteen percent but not greater than sixty-five sixteen
10 percent, the rate shall be twenty-nine twenty-five and
11five-tenths cents for ethanol blended gasoline and thirty and
12five-tenths cents for motor fuel other than ethanol blended
13gasoline.
14(5) If the distribution percentage is greater than
15sixty-five sixteen percent but not greater than seventy
16 eighteen percent, the rate shall be twenty-nine twenty-six
17 cents for ethanol blended gasoline and thirty and seven-tenths
18cents for motor fuel other than ethanol blended gasoline.
19(6) If the distribution percentage is greater than
20seventy eighteen percent but not greater than seventy-five
21 twenty percent, the rate shall be twenty-nine twenty-six and
22five-tenths cents for ethanol blended gasoline and thirty-one
23cents for motor fuel other than ethanol blended gasoline.
24(7) If the distribution percentage is greater than
25seventy-five twenty percent but not greater than eighty
26 twenty-two percent, the rate shall be twenty-nine and
27three-tenths twenty-seven cents for ethanol blended gasoline
28and thirty and eight-tenths cents for motor fuel other than
29ethanol blended gasoline.
30(8) If the distribution percentage is greater than eighty
31 twenty-two percent but not greater than eighty-five twenty-six
32 percent, the rate shall be twenty-nine twenty-seven and
33five-tenths cents for ethanol blended gasoline and thirty and
34seven-tenths cents for motor fuel other than ethanol blended
35gasoline.
-2- 1(9) If the distribution percentage is greater than
2eighty-five twenty-six percent but not greater than ninety
3 thirty-five percent, the rate shall be twenty-nine and
4seven-tenths twenty-eight cents for ethanol blended gasoline
5and thirty and four-tenths cents for motor fuel other than
6ethanol blended gasoline.
7(10) If the distribution percentage is greater than ninety
8 thirty-five percent but not greater than ninety-five forty-five
9 percent, the rate shall be twenty-nine and nine-tenths
10 twenty-eight and five-tenths cents for ethanol blended gasoline
11and thirty and one-tenth cents for motor fuel other than
12ethanol blended gasoline.
13(11) If the distribution percentage is greater than
14ninety-five forty-five percent but not greater than sixty-five
15percent, the rate shall be thirty twenty-nine cents for ethanol
16blended gasoline and thirty cents for motor fuel other than
17ethanol blended gasoline.
18(12) If the distribution percentage is greater than
19sixty-five percent but not greater than eighty-five percent,
20the rate shall be twenty-nine and two-tenths cents.
21(13) If the distribution percentage is greater than
22eighty-five percent but not greater than ninety-five percent,
23the rate shall be twenty-nine and five-tenths cents.
24(14) If the distribution percentage is greater than
25ninety-five percent, the rate shall be thirty cents.
26c. The provisions of paragraph “b” and subsection 6
27 3, paragraph “a”, subparagraph (2), shall be subject to
28legislative review at least every six five years. The review
29shall be based upon a fuel distribution percentage formula
30status report containing the recommendations of a legislative
31interim committee appointed to conduct a review of the fuel
32distribution percentage formulas, to be prepared with the
33assistance of the department of revenue in association
34with the department of transportation. The report shall
35include recommendations for changes or revisions to the
-3-1fuel distribution percentage formulas based upon advances
2in technology, fuel use trends, and fuel price fluctuations
3observed during the preceding six-year five-year interval; an
4analysis of the operation of the fuel distribution percentage
5formulas during the preceding six-year five-year interval; and
6a summary of issues that have arisen since the previous review
7and potential approaches for resolution of those issues. The
8first such report shall be submitted to the general assembly
9no later than January 1, 2020 2025, with subsequent reports
10developed and submitted by January 1 at least every sixth fifth
11 year thereafter.
122. Except as otherwise provided in this section and in this
13subchapter, after June 30, 2020, an excise tax of thirty cents
14is imposed on each gallon of motor fuel used for any purpose
15for the privilege of operating motor vehicles in this state.
163. An excise tax of seventeen cents is imposed on each
17gallon of E-85 gasoline, subject to the determination provided
18in subsection 4.
194. The rate of the excise tax on E-85 gasoline imposed in
20subsection 3 shall be determined based on the number of gallons
21of E-85 gasoline that are distributed in this state during the
22previous calendar year. The department shall determine the
23actual tax paid for E-85 gasoline for each period beginning
24January 1 and ending December 31. The amount of the tax paid on
25E-85 gasoline during the past calendar year shall be compared
26to the amount of tax on E-85 gasoline that would have been paid
27using the tax rate for gasoline imposed in subsection 1 or
282 and a difference shall be established. If this difference
29is equal to or greater than twenty-five thousand dollars, the
30tax rate for E-85 gasoline for the period beginning July 1
31following the end of the determination period shall be the rate
32in effect as stated in subsection 1 or 2.
335. 2. For the privilege of operating aircraft in this
34state, an excise tax of eight cents per gallon is imposed on
35the use of all aviation gasoline.
-4- 16. 3. a. For the privilege of operating motor vehicles or
2aircraft in this state, there is imposed an excise tax on the
3use of special fuel in a motor vehicle or aircraft.
4(1) Except as otherwise provided in this section and in
5this subchapter, for the period ending June 30, 2015, and for
6the period beginning July 1, 2020, and thereafter, the rate
7of the excise tax rate on each gallon of special fuel for
8diesel engines of motor vehicles used for any purpose for the
9privilege of operating motor vehicles in this state, other
10than biodiesel blended fuel classified as B-11 or higher, is
11thirty-two and five-tenths cents per gallon.
12(2) Except as otherwise provided in this section and in this
13subchapter, for the period beginning July 1, 2015, and ending
14June 30, 2020, this subparagraph shall apply to the excise tax
15imposed on each gallon of special fuel for diesel engines of
16motor vehicles biodiesel blended fuel classified as B-11 or
17higher used for any purpose for the privilege of operating
18motor vehicles in this state. The rate of the excise tax
19shall be based on the number of gallons of biodiesel blended
20fuel classified as B-11 or higher that is distributed in this
21state as expressed as a percentage of the number of gallons of
22special fuel for diesel engines of motor vehicles distributed
23in this state, which is referred to as the distribution
24percentage. The department shall determine the percentage
25basis for each determination period beginning January 1 and
26ending December 31. The rate for of the excise tax shall apply
27for the period beginning July 1 and ending June 30 following
28the end of the determination period. The rate for of the
29excise tax on each gallon of biodiesel blended fuel classified
30as B-11 or higher shall be as follows:
31(a) If the distribution percentage is not greater than fifty
32percent, the rate shall be twenty-nine and five-tenths cents
33for biodiesel blended fuel classified as B-11 or higher and
34thirty-two and five-tenths cents for special fuel for diesel
35engines of motor vehicles other than biodiesel blended fuel
-5-1classified as B-11 or higher.
2(b) If the distribution percentage is greater than fifty
3percent but not greater than fifty-five percent, the rate
4shall be twenty-nine and eight-tenths cents for biodiesel
5blended fuel classified as B-11 or higher and thirty-two and
6five-tenths cents for special fuel for diesel engines of motor
7vehicles other than biodiesel blended fuel classified as B-11
8or higher.
9(c) If the distribution percentage is greater than
10fifty-five percent but not greater than sixty percent, the rate
11shall be thirty and one-tenth cents for biodiesel blended fuel
12classified as B-11 or higher and thirty-two and five-tenths
13cents for special fuel for diesel engines of motor vehicles
14other than biodiesel blended fuel classified as B-11 or higher.
15(d) If the distribution percentage is greater than sixty
16percent but not greater than sixty-five percent, the rate shall
17be thirty and four-tenths cents for biodiesel blended fuel
18classified as B-11 or higher and thirty-two and five-tenths
19cents for special fuel for diesel engines of motor vehicles
20other than biodiesel blended fuel classified as B-11 or higher.
21(e) If the distribution percentage is greater than
22sixty-five percent but not greater than seventy percent, the
23rate shall be thirty and seven-tenths cents for biodiesel
24blended fuel classified as B-11 or higher and thirty-two and
25five-tenths cents for special fuel for diesel engines of motor
26vehicles other than biodiesel blended fuel classified as B-11
27or higher.
28(f) If the distribution percentage is greater than seventy
29percent but not greater than seventy-five percent, the rate
30shall be thirty-one cents for biodiesel blended fuel classified
31as B-11 or higher and thirty-two and five-tenths cents for
32special fuel for diesel engines of motor vehicles other than
33biodiesel blended fuel classified as B-11 or higher.
34(g) If the distribution percentage is greater than
35seventy-five percent but not greater than eighty percent, the
-6-1rate shall be thirty-one and three-tenths cents for biodiesel
2blended fuel classified as B-11 or higher and thirty-two and
3five-tenths cents for special fuel for diesel engines of motor
4vehicles other than biodiesel blended fuel classified as B-11
5or higher.
6(h) If the distribution percentage is greater than eighty
7percent but not greater than eighty-five percent, the rate
8shall be thirty-one and six-tenths cents for biodiesel
9blended fuel classified as B-11 or higher and thirty-two and
10five-tenths cents for special fuel for diesel engines of motor
11vehicles other than biodiesel blended fuel classified as B-11
12or higher.
13(i) If the distribution percentage is greater than
14eighty-five percent but not greater than ninety percent, the
15rate shall be thirty-one and nine-tenths cents for biodiesel
16blended fuel classified as B-11 or higher and thirty-two and
17five-tenths cents for special fuel for diesel engines of motor
18vehicles other than biodiesel blended fuel classified as B-11
19or higher.
20(j) If the distribution percentage is greater than ninety
21percent but not greater than ninety-five percent, the rate
22shall be thirty-two and two-tenths cents for biodiesel
23blended fuel classified as B-11 or higher and thirty-two and
24five-tenths cents for special fuel for diesel engines of motor
25vehicles other than biodiesel blended fuel classified as B-11
26or higher.
27(k) If the distribution percentage is greater than
28ninety-five percent, the rate shall be thirty-two and
29five-tenths cents for biodiesel blended fuel classified as B-11
30or higher and thirty-two and five-tenths cents for special
31fuel for diesel engines of motor vehicles other than biodiesel
32blended fuel classified as B-11 or higher.
33(3) The rate of the excise tax on special fuel for aircraft
34is five cents per gallon.
35(4) On all other special fuel, unless otherwise specified in
-7-1this section, the per gallon rate of the excise tax is the same
2as the motor fuel tax under subsection 1.
3b. Indelible dye meeting United States environmental
4protection agency and internal revenue service regulations must
5be added to fuel before or upon withdrawal at a terminal or
6refinery rack for that fuel to be exempt from tax and the dyed
7fuel may be used only for an exempt purpose.
8 Sec. 2. Section 452A.31, subsection 2, paragraph a,
9subparagraph (1), Code 2019, is amended by adding the following
10new subparagraph division:
11 NEW SUBPARAGRAPH DIVISION. (c) The total E-15 gasoline
12gallonage which is the total number of gallons of ethanol
13blended gasoline classified as E-15 or higher, including E-85
14gasoline.
15 Sec. 3. Section 452A.31, subsection 3, paragraph a, Code
162019, is amended by adding the following new subparagraph:
17 NEW SUBPARAGRAPH. (1A) The total B-11 gallonage which
18is the total number of gallons of biodiesel blended fuel
19classified as B-11 or higher.
20 Sec. 4. Section 452A.31, subsection 4, paragraph a,
21subparagraph (1), Code 2019, is amended by adding the following
22new subparagraph division:
23 NEW SUBPARAGRAPH DIVISION. (c) The aggregate E-15 gasoline
24gallonage which is the aggregate total number of gallons
25of ethanol blended gasoline classified as E-15 or higher,
26including E-85 gasoline.
27 Sec. 5. Section 452A.31, subsection 5, paragraph a, Code
282019, is amended by adding the following new subparagraph:
29 NEW SUBPARAGRAPH. (1A) The aggregate B-11 gallonage which
30is the aggregate total number of gallons of biodiesel blended
31fuel classified as B-11 or higher.
32EXPLANATION
33The inclusion of this explanation does not constitute agreement with
34the explanation’s substance by the members of the general assembly.
35This bill relates to the excise taxes on motor fuel and
-8-1certain special fuel.
2Under current law, until June 30, 2020, the per-gallon
3excise tax on ethanol blended gasoline is up to 2 cents less
4than the per-gallon excise tax on other motor fuel, based on
5the distribution percentage of the fuels. After June 30, 2020,
6the per-gallon excise tax on ethanol blended gasoline and other
7motor fuel is 30 cents. The bill instead imposes a per-gallon
8excise tax of 30 cents on motor fuel other than ethanol blended
9gasoline classified as E-15 or higher. The bill imposes a
10per-gallon excise tax on ethanol blended gasoline classified as
11E-15 or higher that is up to 6 cents less than the per-gallon
12excise tax on other motor fuel, based on the distribution
13percentage of the fuels. If the distribution percentage is
14greater than 95 percent, the per-gallon excise tax on motor
15fuel other than ethanol blended gasoline classified as E-15 or
16higher is equal to the per-gallon excise tax on ethanol blended
17gasoline classified as E-15 or higher.
18Current law provides for legislative review of the fuel
19distribution percentage formulas at least every six years,
20with the first report due no later than January 1, 2020. The
21bill instead provides for legislative review of the fuel
22distribution percentage formulas at least every five years,
23with the first report due no later than January 1, 2025.
24Under current law, the per-gallon excise tax on E-85
25gasoline is up to 14 cents less than the per-gallon excise tax
26on other motor fuel, depending on the amount of excise tax
27paid on E-85 gasoline during the past calendar year and the
28amount of the excise tax on other motor fuel. The bill strikes
29the provisions relating to the per-gallon excise tax on E-85
30gasoline.
31Under current law, until June 30, 2020, the per-gallon
32excise tax on biodiesel blended fuel classified as B-11 or
33higher is up to 3 cents less than the per-gallon excise tax
34on other special fuel for diesel engines of motor vehicles,
35based on the distribution percentage of the fuels. After June
-9-130, 2020, the per-gallon excise tax on biodiesel blended fuel
2classified as B-11 or higher and other special fuel for diesel
3engines of motor vehicles is 32.5 cents. The bill strikes the
4date on which the per-gallon excise tax on biodiesel blended
5fuel classified as B-11 or higher and other special fuel for
6diesel engines of motor vehicles will both become 32.5 cents.
7Therefore, under the bill, the per-gallon excise tax on special
8fuel for diesel engines of motor vehicles other than biodiesel
9blended fuel classified as B-11 or higher is 32.5 cents. The
10per-gallon excise tax on biodiesel blended fuel classified as
11B-11 or higher is up to 3 cents less than the per-gallon excise
12tax on other special fuel for diesel engines of motor vehicles,
13based on the distribution percentage of the fuels.
14The bill creates reporting classifications under Code
15section 452A.31 for ethanol blended gasoline classified as
16E-15 or higher and biodiesel blended fuel classified as B-11
17or higher for purposes of gallonage reports submitted to the
18department of revenue pursuant to Code section 452A.33.
19By operation of law, to the extent the excise tax on E-85
20gasoline and ethanol blended gasoline classified as lower than
21E-15 is increased more than 0.5 cents per gallon, the inventory
22tax set forth in Code section 452A.85 applies.
-10-ns/jh
2special fuel.
3BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 452A.3, subsections 1, 2, 3, 4, 5, and 6,
2Code 2019, are amended to read as follows:
31. Except as otherwise provided in this section and in this
4subchapter, until June 30, 2020, this subsection shall apply
5to the excise tax imposed on each gallon of motor fuel used for
6any purpose for the privilege of operating motor vehicles in
7this state.
8a. An excise tax of thirty cents is imposed on each gallon
9of motor fuel other than ethanol blended gasoline classified
10as E-15 or higher.
11a. b. The rate of the excise tax on ethanol blended
12gasoline classified as E-15 or higher shall be based on the
13number of gallons of ethanol blended gasoline classified
14as E-15 or higher that is are distributed in this state as
15expressed as a percentage of the number of gallons of motor
16fuel distributed in this state, which is referred to as the
17distribution percentage. For purposes of this subsection
18 paragraph, only ethanol blended gasoline and nonblended
19gasoline, not including aviation gasoline, shall be used in
20determining the percentage basis for the excise tax. The
21department shall determine the percentage basis for each
22determination period beginning January 1 and ending December
2331. The rate for the excise tax shall apply for the period
24beginning July 1 and ending June 30 following the end of the
25determination period. The rate of the excise tax on each
26gallon of ethanol blended gasoline classified as E-15 or higher
27shall be as follows:
28b. The rate for the excise tax shall be as follows:
29(1) If the distribution percentage is not greater than fifty
30 ten percent, the rate shall be twenty-nine twenty-four cents
31for ethanol blended gasoline and thirty cents for motor fuel
32other than ethanol blended gasoline.
33(2) If the distribution percentage is greater than fifty
34 ten percent but not greater than fifty-five twelve percent, the
35rate shall be twenty-nine twenty-four and five-tenths cents for
-1-1ethanol blended gasoline and thirty and one-tenth cents for
2motor fuel other than ethanol blended gasoline.
3(3) If the distribution percentage is greater than
4fifty-five twelve percent but not greater than sixty fourteen
5 percent, the rate shall be twenty-nine twenty-five cents for
6ethanol blended gasoline and thirty and three-tenths cents for
7motor fuel other than ethanol blended gasoline.
8(4) If the distribution percentage is greater than sixty
9 fourteen percent but not greater than sixty-five sixteen
10 percent, the rate shall be twenty-nine twenty-five and
11five-tenths cents for ethanol blended gasoline and thirty and
12five-tenths cents for motor fuel other than ethanol blended
13gasoline.
14(5) If the distribution percentage is greater than
15sixty-five sixteen percent but not greater than seventy
16 eighteen percent, the rate shall be twenty-nine twenty-six
17 cents for ethanol blended gasoline and thirty and seven-tenths
18cents for motor fuel other than ethanol blended gasoline.
19(6) If the distribution percentage is greater than
20seventy eighteen percent but not greater than seventy-five
21 twenty percent, the rate shall be twenty-nine twenty-six and
22five-tenths cents for ethanol blended gasoline and thirty-one
23cents for motor fuel other than ethanol blended gasoline.
24(7) If the distribution percentage is greater than
25seventy-five twenty percent but not greater than eighty
26 twenty-two percent, the rate shall be twenty-nine and
27three-tenths twenty-seven cents for ethanol blended gasoline
28and thirty and eight-tenths cents for motor fuel other than
29ethanol blended gasoline.
30(8) If the distribution percentage is greater than eighty
31 twenty-two percent but not greater than eighty-five twenty-six
32 percent, the rate shall be twenty-nine twenty-seven and
33five-tenths cents for ethanol blended gasoline and thirty and
34seven-tenths cents for motor fuel other than ethanol blended
35gasoline.
-2- 1(9) If the distribution percentage is greater than
2eighty-five twenty-six percent but not greater than ninety
3 thirty-five percent, the rate shall be twenty-nine and
4seven-tenths twenty-eight cents for ethanol blended gasoline
5and thirty and four-tenths cents for motor fuel other than
6ethanol blended gasoline.
7(10) If the distribution percentage is greater than ninety
8 thirty-five percent but not greater than ninety-five forty-five
9 percent, the rate shall be twenty-nine and nine-tenths
10 twenty-eight and five-tenths cents for ethanol blended gasoline
11and thirty and one-tenth cents for motor fuel other than
12ethanol blended gasoline.
13(11) If the distribution percentage is greater than
14ninety-five forty-five percent but not greater than sixty-five
15percent, the rate shall be thirty twenty-nine cents for ethanol
16blended gasoline and thirty cents for motor fuel other than
17ethanol blended gasoline.
18(12) If the distribution percentage is greater than
19sixty-five percent but not greater than eighty-five percent,
20the rate shall be twenty-nine and two-tenths cents.
21(13) If the distribution percentage is greater than
22eighty-five percent but not greater than ninety-five percent,
23the rate shall be twenty-nine and five-tenths cents.
24(14) If the distribution percentage is greater than
25ninety-five percent, the rate shall be thirty cents.
26c. The provisions of paragraph “b” and subsection 6
27 3, paragraph “a”, subparagraph (2), shall be subject to
28legislative review at least every six five years. The review
29shall be based upon a fuel distribution percentage formula
30status report containing the recommendations of a legislative
31interim committee appointed to conduct a review of the fuel
32distribution percentage formulas, to be prepared with the
33assistance of the department of revenue in association
34with the department of transportation. The report shall
35include recommendations for changes or revisions to the
-3-1fuel distribution percentage formulas based upon advances
2in technology, fuel use trends, and fuel price fluctuations
3observed during the preceding six-year five-year interval; an
4analysis of the operation of the fuel distribution percentage
5formulas during the preceding six-year five-year interval; and
6a summary of issues that have arisen since the previous review
7and potential approaches for resolution of those issues. The
8first such report shall be submitted to the general assembly
9no later than January 1, 2020 2025, with subsequent reports
10developed and submitted by January 1 at least every sixth fifth
11 year thereafter.
122. Except as otherwise provided in this section and in this
13subchapter, after June 30, 2020, an excise tax of thirty cents
14is imposed on each gallon of motor fuel used for any purpose
15for the privilege of operating motor vehicles in this state.
163. An excise tax of seventeen cents is imposed on each
17gallon of E-85 gasoline, subject to the determination provided
18in subsection 4.
194. The rate of the excise tax on E-85 gasoline imposed in
20subsection 3 shall be determined based on the number of gallons
21of E-85 gasoline that are distributed in this state during the
22previous calendar year. The department shall determine the
23actual tax paid for E-85 gasoline for each period beginning
24January 1 and ending December 31. The amount of the tax paid on
25E-85 gasoline during the past calendar year shall be compared
26to the amount of tax on E-85 gasoline that would have been paid
27using the tax rate for gasoline imposed in subsection 1 or
282 and a difference shall be established. If this difference
29is equal to or greater than twenty-five thousand dollars, the
30tax rate for E-85 gasoline for the period beginning July 1
31following the end of the determination period shall be the rate
32in effect as stated in subsection 1 or 2.
335. 2. For the privilege of operating aircraft in this
34state, an excise tax of eight cents per gallon is imposed on
35the use of all aviation gasoline.
-4- 16. 3. a. For the privilege of operating motor vehicles or
2aircraft in this state, there is imposed an excise tax on the
3use of special fuel in a motor vehicle or aircraft.
4(1) Except as otherwise provided in this section and in
5this subchapter, for the period ending June 30, 2015, and for
6the period beginning July 1, 2020, and thereafter, the rate
7of the excise tax rate on each gallon of special fuel for
8diesel engines of motor vehicles used for any purpose for the
9privilege of operating motor vehicles in this state, other
10than biodiesel blended fuel classified as B-11 or higher, is
11thirty-two and five-tenths cents per gallon.
12(2) Except as otherwise provided in this section and in this
13subchapter, for the period beginning July 1, 2015, and ending
14June 30, 2020, this subparagraph shall apply to the excise tax
15imposed on each gallon of special fuel for diesel engines of
16motor vehicles biodiesel blended fuel classified as B-11 or
17higher used for any purpose for the privilege of operating
18motor vehicles in this state. The rate of the excise tax
19shall be based on the number of gallons of biodiesel blended
20fuel classified as B-11 or higher that is distributed in this
21state as expressed as a percentage of the number of gallons of
22special fuel for diesel engines of motor vehicles distributed
23in this state, which is referred to as the distribution
24percentage. The department shall determine the percentage
25basis for each determination period beginning January 1 and
26ending December 31. The rate for of the excise tax shall apply
27for the period beginning July 1 and ending June 30 following
28the end of the determination period. The rate for of the
29excise tax on each gallon of biodiesel blended fuel classified
30as B-11 or higher shall be as follows:
31(a) If the distribution percentage is not greater than fifty
32percent, the rate shall be twenty-nine and five-tenths cents
33for biodiesel blended fuel classified as B-11 or higher and
34thirty-two and five-tenths cents for special fuel for diesel
35engines of motor vehicles other than biodiesel blended fuel
-5-1classified as B-11 or higher.
2(b) If the distribution percentage is greater than fifty
3percent but not greater than fifty-five percent, the rate
4shall be twenty-nine and eight-tenths cents for biodiesel
5blended fuel classified as B-11 or higher and thirty-two and
6five-tenths cents for special fuel for diesel engines of motor
7vehicles other than biodiesel blended fuel classified as B-11
8or higher.
9(c) If the distribution percentage is greater than
10fifty-five percent but not greater than sixty percent, the rate
11shall be thirty and one-tenth cents for biodiesel blended fuel
12classified as B-11 or higher and thirty-two and five-tenths
13cents for special fuel for diesel engines of motor vehicles
14other than biodiesel blended fuel classified as B-11 or higher.
15(d) If the distribution percentage is greater than sixty
16percent but not greater than sixty-five percent, the rate shall
17be thirty and four-tenths cents for biodiesel blended fuel
18classified as B-11 or higher and thirty-two and five-tenths
19cents for special fuel for diesel engines of motor vehicles
20other than biodiesel blended fuel classified as B-11 or higher.
21(e) If the distribution percentage is greater than
22sixty-five percent but not greater than seventy percent, the
23rate shall be thirty and seven-tenths cents for biodiesel
24blended fuel classified as B-11 or higher and thirty-two and
25five-tenths cents for special fuel for diesel engines of motor
26vehicles other than biodiesel blended fuel classified as B-11
27or higher.
28(f) If the distribution percentage is greater than seventy
29percent but not greater than seventy-five percent, the rate
30shall be thirty-one cents for biodiesel blended fuel classified
31as B-11 or higher and thirty-two and five-tenths cents for
32special fuel for diesel engines of motor vehicles other than
33biodiesel blended fuel classified as B-11 or higher.
34(g) If the distribution percentage is greater than
35seventy-five percent but not greater than eighty percent, the
-6-1rate shall be thirty-one and three-tenths cents for biodiesel
2blended fuel classified as B-11 or higher and thirty-two and
3five-tenths cents for special fuel for diesel engines of motor
4vehicles other than biodiesel blended fuel classified as B-11
5or higher.
6(h) If the distribution percentage is greater than eighty
7percent but not greater than eighty-five percent, the rate
8shall be thirty-one and six-tenths cents for biodiesel
9blended fuel classified as B-11 or higher and thirty-two and
10five-tenths cents for special fuel for diesel engines of motor
11vehicles other than biodiesel blended fuel classified as B-11
12or higher.
13(i) If the distribution percentage is greater than
14eighty-five percent but not greater than ninety percent, the
15rate shall be thirty-one and nine-tenths cents for biodiesel
16blended fuel classified as B-11 or higher and thirty-two and
17five-tenths cents for special fuel for diesel engines of motor
18vehicles other than biodiesel blended fuel classified as B-11
19or higher.
20(j) If the distribution percentage is greater than ninety
21percent but not greater than ninety-five percent, the rate
22shall be thirty-two and two-tenths cents for biodiesel
23blended fuel classified as B-11 or higher and thirty-two and
24five-tenths cents for special fuel for diesel engines of motor
25vehicles other than biodiesel blended fuel classified as B-11
26or higher.
27(k) If the distribution percentage is greater than
28ninety-five percent, the rate shall be thirty-two and
29five-tenths cents for biodiesel blended fuel classified as B-11
30or higher and thirty-two and five-tenths cents for special
31fuel for diesel engines of motor vehicles other than biodiesel
32blended fuel classified as B-11 or higher.
33(3) The rate of the excise tax on special fuel for aircraft
34is five cents per gallon.
35(4) On all other special fuel, unless otherwise specified in
-7-1this section, the per gallon rate of the excise tax is the same
2as the motor fuel tax under subsection 1.
3b. Indelible dye meeting United States environmental
4protection agency and internal revenue service regulations must
5be added to fuel before or upon withdrawal at a terminal or
6refinery rack for that fuel to be exempt from tax and the dyed
7fuel may be used only for an exempt purpose.
8 Sec. 2. Section 452A.31, subsection 2, paragraph a,
9subparagraph (1), Code 2019, is amended by adding the following
10new subparagraph division:
11 NEW SUBPARAGRAPH DIVISION. (c) The total E-15 gasoline
12gallonage which is the total number of gallons of ethanol
13blended gasoline classified as E-15 or higher, including E-85
14gasoline.
15 Sec. 3. Section 452A.31, subsection 3, paragraph a, Code
162019, is amended by adding the following new subparagraph:
17 NEW SUBPARAGRAPH. (1A) The total B-11 gallonage which
18is the total number of gallons of biodiesel blended fuel
19classified as B-11 or higher.
20 Sec. 4. Section 452A.31, subsection 4, paragraph a,
21subparagraph (1), Code 2019, is amended by adding the following
22new subparagraph division:
23 NEW SUBPARAGRAPH DIVISION. (c) The aggregate E-15 gasoline
24gallonage which is the aggregate total number of gallons
25of ethanol blended gasoline classified as E-15 or higher,
26including E-85 gasoline.
27 Sec. 5. Section 452A.31, subsection 5, paragraph a, Code
282019, is amended by adding the following new subparagraph:
29 NEW SUBPARAGRAPH. (1A) The aggregate B-11 gallonage which
30is the aggregate total number of gallons of biodiesel blended
31fuel classified as B-11 or higher.
32EXPLANATION
33The inclusion of this explanation does not constitute agreement with
34the explanation’s substance by the members of the general assembly.
35This bill relates to the excise taxes on motor fuel and
-8-1certain special fuel.
2Under current law, until June 30, 2020, the per-gallon
3excise tax on ethanol blended gasoline is up to 2 cents less
4than the per-gallon excise tax on other motor fuel, based on
5the distribution percentage of the fuels. After June 30, 2020,
6the per-gallon excise tax on ethanol blended gasoline and other
7motor fuel is 30 cents. The bill instead imposes a per-gallon
8excise tax of 30 cents on motor fuel other than ethanol blended
9gasoline classified as E-15 or higher. The bill imposes a
10per-gallon excise tax on ethanol blended gasoline classified as
11E-15 or higher that is up to 6 cents less than the per-gallon
12excise tax on other motor fuel, based on the distribution
13percentage of the fuels. If the distribution percentage is
14greater than 95 percent, the per-gallon excise tax on motor
15fuel other than ethanol blended gasoline classified as E-15 or
16higher is equal to the per-gallon excise tax on ethanol blended
17gasoline classified as E-15 or higher.
18Current law provides for legislative review of the fuel
19distribution percentage formulas at least every six years,
20with the first report due no later than January 1, 2020. The
21bill instead provides for legislative review of the fuel
22distribution percentage formulas at least every five years,
23with the first report due no later than January 1, 2025.
24Under current law, the per-gallon excise tax on E-85
25gasoline is up to 14 cents less than the per-gallon excise tax
26on other motor fuel, depending on the amount of excise tax
27paid on E-85 gasoline during the past calendar year and the
28amount of the excise tax on other motor fuel. The bill strikes
29the provisions relating to the per-gallon excise tax on E-85
30gasoline.
31Under current law, until June 30, 2020, the per-gallon
32excise tax on biodiesel blended fuel classified as B-11 or
33higher is up to 3 cents less than the per-gallon excise tax
34on other special fuel for diesel engines of motor vehicles,
35based on the distribution percentage of the fuels. After June
-9-130, 2020, the per-gallon excise tax on biodiesel blended fuel
2classified as B-11 or higher and other special fuel for diesel
3engines of motor vehicles is 32.5 cents. The bill strikes the
4date on which the per-gallon excise tax on biodiesel blended
5fuel classified as B-11 or higher and other special fuel for
6diesel engines of motor vehicles will both become 32.5 cents.
7Therefore, under the bill, the per-gallon excise tax on special
8fuel for diesel engines of motor vehicles other than biodiesel
9blended fuel classified as B-11 or higher is 32.5 cents. The
10per-gallon excise tax on biodiesel blended fuel classified as
11B-11 or higher is up to 3 cents less than the per-gallon excise
12tax on other special fuel for diesel engines of motor vehicles,
13based on the distribution percentage of the fuels.
14The bill creates reporting classifications under Code
15section 452A.31 for ethanol blended gasoline classified as
16E-15 or higher and biodiesel blended fuel classified as B-11
17or higher for purposes of gallonage reports submitted to the
18department of revenue pursuant to Code section 452A.33.
19By operation of law, to the extent the excise tax on E-85
20gasoline and ethanol blended gasoline classified as lower than
21E-15 is increased more than 0.5 cents per gallon, the inventory
22tax set forth in Code section 452A.85 applies.
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