Introduced Version
SENATE BILL No. 93
_____
DIGEST OF INTRODUCED BILL
Citations Affected: IC 6-2.5.
Synopsis: Limit sales tax on gasoline. Provides that the amount of
sales tax collected on gasoline or diesel fuel may not exceed the
amount of sales tax collected when the pump price is $3 per gallon.
Makes conforming changes.
Effective: June 1, 2009; July 1, 2009.
Young R Michael
January 7, 2009, read first time and referred to Committee on Tax and Fiscal Policy.
Introduced
First Regular Session 116th General Assembly (2009)
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SENATE BILL No. 93
A BILL FOR AN ACT to amend the Indiana Code concerning
taxation.
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 6-2.5-4-1; (09)IN0093.1.1. -->
SECTION 1. IC 6-2.5-4-1 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2009]: Sec. 1. (a) A person is a
retail merchant making a retail transaction when he the person engages
in selling at retail.
(b) A person is engaged in selling at retail when, in the ordinary
course of his the person's regularly conducted trade or business, he:
the person:
(1) acquires tangible personal property for the purpose of resale;
and
(2) transfers that property to another person for consideration.
(c) For purposes of determining what constitutes selling at retail, it
does not matter whether:
(1) the property is transferred in the same form as when it was
acquired;
(2) the property is transferred alone or in conjunction with other
property or services; or
(3) the property is transferred conditionally or otherwise.
(d) Notwithstanding subsection (b), a person is not selling at retail
if he the person is making a wholesale sale as described in section 2
of this chapter.
(e) The gross retail income received from selling at retail is only
taxable under this article to the extent that the income represents:
(1) the price of the property transferred, without the rendition of
any service; and
(2) except as provided in subsection (g), any bona fide charges
which are made for preparation, fabrication, alteration,
modification, finishing, completion, delivery, or other service
performed in respect to the property transferred before its transfer
and which are separately stated on the transferor's records.
For purposes of this subsection, a transfer is considered to have
occurred after delivery of the property to the purchaser.
(f) Notwithstanding subsection (e):
(1) in the case of retail sales of gasoline (as defined in
IC 6-6-1.1-103) and special fuel (as defined in IC 6-6-2.5-22), the
gross retail income received from selling at retail is:
(A) the lesser of:
(i) the total sales price of the gasoline or special fuel; or
(ii) an amount equal to a rate of three dollars ($3) per
gallon of the gasoline or special fuel multiplied by the
number of gallons of gasoline or special fuel sold; minus
(B) the part of that price attributable to tax imposed under
IC 6-6-1.1, IC 6-6-2.5, or Section 4041(a) or Section 4081 of
the Internal Revenue Code; and
(2) in the case of retail sales of cigarettes (as defined in
IC 6-7-1-2), the gross retail income received from selling at retail
is the total sales price of the cigarettes including the tax imposed
under IC 6-7-1.
(g) Gross retail income does not include income that represents
charges for serving or delivering food and food ingredients furnished,
prepared, or served for consumption at a location, or on equipment,
provided by the retail merchant. However, the exclusion under this
subsection only applies if the charges for the serving or delivery are
stated separately from the price of the food and food ingredients when
the purchaser pays the charges.
SOURCE: IC 6-2.5-7-1; (09)IN0093.1.2. -->
SECTION 2. IC 6-2.5-7-1, AS AMENDED BY P.L.1-2007,
SECTION 52, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JUNE 1, 2009]: Sec. 1. (a) The definitions in this section apply
throughout this chapter.
(b) "Kerosene" has the same meaning as the definition contained in
IC 16-44-2-2.
(c) "Gasoline" has the same meaning as the definition contained in
IC 6-6-1.1-103.
(d) "Special fuel" has the same meaning as the definition contained
in IC 6-6-2.5-22.
(e) "E85" has the meaning set forth in IC 6-6-1.1-103.
(f) "Unit" means the unit of measure, such as a gallon or a liter, by
which gasoline or special fuel is sold.
(g) "Metered pump" means a stationary pump which is capable of
metering the amount of gasoline or special fuel dispensed from it and
which is capable of simultaneously calculating and displaying the price
of the gasoline or special fuel dispensed.
(h) "Indiana gasoline tax" means the tax imposed under IC 6-6-1.1.
(i) "Indiana special fuel tax" means the tax imposed under
IC 6-6-2.5.
(j) "Federal gasoline tax" means the excise tax imposed under
Section 4081 of the Internal Revenue Code.
(k) "Federal special fuel tax" means the excise tax imposed under
Section 4041 of the Internal Revenue Code.
(l) "Price per unit before the addition of state and federal taxes"
means an amount which equals the remainder of:
(1) the total price per unit; minus
(2) the state gross retail, Indiana gasoline or special fuel, and
federal gasoline or special fuel taxes which are part of the total
price per unit.
(m) "Total price per unit" means the price per unit at which gasoline
or special fuel is actually sold, including the state gross retail, Indiana
gasoline or special fuel, and federal gasoline or special fuel taxes which
are part of the sales price.
(n) "Distributor" means a person who is the first purchaser of
gasoline from a refiner, a terminal operator, or supplier, regardless of
the location of the purchase.
(o) "Prepayment rate" means a rate per gallon of gasoline
determined by the department under section 14 of this chapter for use
in calculating prepayment amounts of gross retail tax under section 9
of this chapter.
(p) "Purchase or shipment" means a sale or delivery of gasoline, but
does not include:
(1) an exchange transaction between refiners, terminal operators,
or a refiner and terminal operator; or
(2) a delivery by pipeline, ship, or barge to a refiner or terminal
operator.
(q) "Qualified distributor" means a distributor who:
(1) is a licensed distributor under IC 6-6-1.1; and
(2) holds an unrevoked permit issued under section 7 of this
chapter.
(r) "Refiner" means a person who manufactures or produces
gasoline by any process involving substantially more than the blending
of gasoline.
(s) "Terminal operator" means a person that:
(1) stores gasoline in tanks and equipment used in receiving and
storing gasoline from interstate or intrastate pipelines pending
wholesale bulk reshipment; or
(2) stores gasoline at a boat terminal transfer that is a dock or
tank, or equipment contiguous to a dock or tank, including
equipment used in the unloading of gasoline from a ship or barge
and used in transferring the gasoline to a tank pending wholesale
bulk reshipment.
(t) "Maximum taxable price per unit before the addition of state
and federal taxes" means an amount that equals the remainder of:
(1) a total price per unit equivalent to the rate of three dollars
($3) per gallon; minus
(2) the state gross retail, Indiana gasoline or special fuel, and
federal gasoline or special fuel taxes that are part of the total
price per unit.
SOURCE: IC 6-2.5-7-3; (09)IN0093.1.3. -->
SECTION 3. IC 6-2.5-7-3, AS AMENDED BY P.L.146-2008,
SECTION 314, IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2009]: Sec. 3. (a) With respect to the sale of
gasoline which is dispensed from a metered pump, a retail merchant
shall collect, for each unit of gasoline sold, state gross retail tax in an
amount equal to the product, rounded to the nearest one-tenth of one
cent ($0.001), of:
(1)
the lesser of:
(A) the price per unit before the addition of state and federal
taxes;
or
(B) the maximum taxable price per unit before the addition
of state and federal taxes; multiplied by
(2) seven percent (7%).
The retail merchant shall collect the state gross retail tax prescribed in
this section even if the transaction is exempt from taxation under
IC 6-2.5-5.
(b) With respect to the sale of special fuel or kerosene which is
dispensed from a metered pump, unless the purchaser provides an
exemption certificate in accordance with IC 6-2.5-8-8, a retail merchant
shall collect, for each unit of special fuel or kerosene sold, state gross
retail tax in an amount equal to the product, rounded to the nearest
one-tenth of one cent ($0.001), of:
(1) the lesser of:
(1) the price per unit before the addition of state and federal
taxes; or
(2) the maximum taxable price per unit before the addition
of state and federal taxes; multiplied by
(2) seven percent (7%).
Unless the exemption certificate is provided, the retail merchant shall
collect the state gross retail tax prescribed in this section even if the
transaction is exempt from taxation under IC 6-2.5-5.
SOURCE: IC 6-2.5-7-5; (09)IN0093.1.4. -->
SECTION 4. IC 6-2.5-7-5, AS AMENDED BY P.L.146-2008,
SECTION 315, IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2009]: Sec. 5. (a) Each retail merchant who
dispenses gasoline or special fuel from a metered pump shall, in the
manner prescribed in IC 6-2.5-6, report to the department the following
information:
(1) The total number of gallons of gasoline sold from a metered
pump during the period covered by the report.
(2) The total amount of money received from the sale of gasoline
described in subdivision (1) during the period covered by the
report.
(3) That portion of the amount described in subdivision (2) which
represents state and federal taxes imposed under this article,
IC 6-6-1.1, or Section 4081 of the Internal Revenue Code.
(4) The total number of gallons of special fuel sold from a
metered pump during the period covered by the report.
(5) The total amount of money received from the sale of special
fuel during the period covered by the report.
(6) That portion of the amount described in subdivision (5) that
represents state and federal taxes imposed under this article,
IC 6-6-2.5, or Section 4041 of the Internal Revenue Code.
(7) The total number of gallons of E85 sold from a metered pump
during the period covered by the report.
(b) Concurrently with filing the report, the retail merchant shall
remit the state gross retail tax
in an amount which equals six and
fifty-four hundredths percent (6.54%) of the gross receipts, including
state gross retail taxes but excluding Indiana and federal gasoline and
special fuel taxes, received by that the retail merchant
was required
to collect from the sale of the gasoline and special fuel
for the period
that is covered by the report.
and on which the retail merchant was
required to collect state gross retail tax. The retail merchant shall remit
that amount regardless of the amount of state gross retail tax which the
merchant has actually collected under this chapter. However, the retail
merchant is entitled to deduct and retain the amounts prescribed in
subsection (c), IC 6-2.5-6-10, and IC 6-2.5-6-11.
(c) A retail merchant is entitled to deduct from the amount of state
gross retail tax required to be remitted under subsection (b) the amount
determined under STEP THREE of the following formula:
STEP ONE: Determine:
(A) the sum of the prepayment amounts made during the
period covered by the retail merchant's report; minus
(B) the sum of prepayment amounts collected by the retail
merchant, in the merchant's capacity as a qualified distributor,
during the period covered by the retail merchant's report.
STEP TWO: Subject to subsection (d), for reporting periods
ending before July 1, 2020, determine the product of:
(A) eighteen cents ($0.18); multiplied by
(B) the number of gallons of E85 sold at retail by the retail
merchant during the period covered by the retail merchant's
report.
STEP THREE: Add the amounts determined under STEPS ONE
and TWO.
For purposes of this section, a prepayment of the gross retail tax is
presumed to occur on the date on which it is invoiced.
(d) The total amount of deductions allowed under subsection (c)
STEP TWO may not exceed one million dollars ($1,000,000) for all
retail merchants in all reporting periods. A retail merchant is not
required to apply for an allocation of deductions under subsection (c)
STEP TWO. If the department determines that the sum of:
(1) the deductions that would otherwise be reported under
subsection (c) STEP TWO for a reporting period; plus
(2) the total amount of deductions granted under subsection (c)
STEP TWO in all preceding reporting periods;
will exceed one million dollars ($1,000,000), the department shall
publish in the Indiana Register a notice that the deduction program
under subsection (c) STEP TWO is terminated after the date specified
in the notice and that no additional deductions will be granted for retail
transactions occurring after the date specified in the notice.
SOURCE: IC 6-2.5-7-14; (09)IN0093.1.5. -->
SECTION 5. IC 6-2.5-7-14, AS AMENDED BY P.L.176-2006,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JUNE 1, 2009]: Sec. 14. (a) Before June 10 and December 10 of each
year, the department shall determine and provide to:
(1) each refiner and terminal operator and each qualified
distributor known to the department to be required to collect
prepayments of the state gross retail tax under this chapter; and
(2) any other person that makes a request;
a notice of the prepayment rate to be used during the following six (6)
month period. The department shall also have the prepayment rate
published in the June and December issues of the Indiana Register.
(b) In determining the prepayment rate under this section, the
department shall use the most recent retail price of gasoline available
to the department.
(c) The prepayment rate per gallon of gasoline determined by the
department under this section is the amount per gallon of gasoline
determined under STEP FOUR of the following formula:
STEP ONE: Determine the lesser of:
(A) the statewide average retail price per gallon of gasoline,
excluding the Indiana and federal gasoline taxes and the
Indiana gross retail tax; or
(B) the maximum taxable price per gallon of gasoline
before the addition of state and federal taxes.
STEP TWO: Determine the product of the following:
(A) The STEP ONE amount.
(B) The Indiana gross retail tax rate.
(C) Ninety percent (90%).
STEP THREE: Determine the lesser of:
(A) the STEP TWO result; or
(B) the product of:
(i) the prepayment rate in effect on the day immediately
preceding the day on which the prepayment rate is
redetermined under this section; multiplied by
(ii) one hundred twenty-five percent (125%).
STEP FOUR: Round the STEP THREE result to the nearest
one-tenth of one cent ($0.001).
SOURCE: ; (09)IN0093.1.6. -->
SECTION 6.
An emergency is declared for this act.