SEC. 9001. SHORT TITLE; AMENDMENT OF 1986 CODE. [Legislation]
This section provides the short title for Title IX, and provides that amendments would be made to the Internal Revenue Code of 1986 (Title 26 of the United States Code), unless otherwise provided.
SEC. 9002. EXTENSION OF HIGHWAY-RELATED TAXES AND TRUST FUND. [Legislation]
This provision would extend all Highway Trust Fund excise taxes at the current rates through September 30, 2011, and would extend transfer of gross receipts from highway excise taxes to the Highway Trust Fund. The provision would also extend current motor fuel tax exemptions. The provision would extend Highway Trust Fund expenditure authority through September 30, 2011, and would update the expenditure purposes for the Highway and Mass Transit Accounts to the purposes included in authorizing legislation up to and including this bill.
SEC. 9003. EXTENSION OF TAX BENEFITS FOR ALCOHOL FUELS. [Legislation]
This provision would extend the ethanol and renewable-source methanol tax provisions through September 30, 2014 (excise tax reduction), and December 31, 2014 (income tax credit), respectively. This provision would also extend until 2014 the authority for refund of the difference between the usual fuel tax and the incentive tax for gasoline, diesel fuel, and aviation fuel used to produce certain alcohol fuels that qualify for an incentive tax rate.
SEC. 9004. PRIVATE ACTIVITY BONDS FOR SURFACE TRANSPORTATION INFRASTRUCTURE. [Legislation]
Currently, tax-exempt private activity bonds may be issued for certain privately developed and operated facilities, including airport facilities, docks and wharves, water, sewage and solid waste disposal facilities, mass commuting facilities, qualified residential rental projects, qualified hazardous waste facilities, high-speed intercity rail facilities, and environmental enhancements of hydro-electric generating facilities.
This provision would amend the Internal Revenue Code to include highway facilities and surface freight transfer facilities among the types of privately developed and operated projects that can utilize tax-exempt private activity bond financing. The new bonds would be subject to the Internal Revenue Code rules that govern exempt facility bonds, except that they would not count against a State's private activity bond volume cap. The maximum aggregate amount of bonds that could be issued under the provision would be $15 billion. The Secretary of Transportation would allocate the $15 billion of authority among eligible projects.
Highway facilities eligible for financing under the program would consist of any surface transportation project eligible for Federal assistance under title 23 of the United States Code, or any project for an international bridge or tunnel for which an international entity authorized under Federal or State law is responsible. Surface freight transfer facilities would consist of facilities for the transfer of freight from truck to rail or rail to truck, including any temporary storage facilities directly related to those transfers. Examples of eligible surface freight transfer facilities would include cranes, loading docks, and computer-controlled equipment that are integral to such freight transfers. Examples of non-qualifying facilities would include lodging, retail, industrial, or manufacturing facilities.
SEC. 9005. ALL ALCOHOL FUEL TAXES TRANSFERRED TO HIGHWAY TRUST FUND. [Legislation]
Currently, all tax revenues on the highway use of motor fuels are deposited in the Federal Highway Trust Fund, except for 2.5 cents per gallon of the tax on gasohol that is deposited in the General Fund. This section would eliminate the deposit of 2.5 cents per gallon of gasohol tax revenues in the General Fund and deposit all tax revenues from the highway use of gasohol to the Federal Highway Trust Fund. This is consistent with the well-established principle of dedicating highway user taxes to the Highway Trust Fund.
SEC. 9006. TRANSFER FROM HIGHWAY TRUST FUND TO BOAT SAFETY ACCOUNT. [Legislation]
This amendment would extend through fiscal year 2011 the authorization for Federal gasoline excise taxes that are attributable to motorboat use to be transferred from the Highway Trust Fund to the Boat Safety Account of the Aquatic Resources Trust Fund (ARTF). As provided in current law, the balance of the motorboat fuel taxes would continue to be transferred to the Land and Water Conservation Fund ($1 million) and the Sport Fish Restoration Account of the ARTF. It also extends through fiscal year 2009 the authorization of expenditures from the Boat Safety Account.
Funds in the Boat Safety Account are authorized to provide financial assistance for the development, implementation, and administration of a coordinated State Recreational Boating Safety (RBS) Grant Program, which is an integral component of the National RBS Program. Current law (46 U.S.C. 13106; 26 U.S.C. 9503) authorizes a discretionary annual appropriation of up to $70 million from the Boat Safety Account.
This section would also make a technical correction to section 1151(e) of the Homeland Security Act. Section 1151(e) prohibits the Department of Homeland Security from using Transportation Trust Funds except for (1) security funds provided to the Federal Aviation Administration prior to fiscal year 2003 and (2) the boating safety funds (addressed here) that are transferred to the Aquatic Resources Trust Fund. However, the authority as to boating safety funds needs clarification, and would be amended to read as follows: "and any funds provided to the Coast Guard from the Highway Trust Fund and transferred into the Boat Safety Account of the Aquatic Resources Trust Fund for boating safety programs.".
SEC. 9007. EXTENSION OF SMALL ENGINE FUEL TAXES TRANSFERRED TO SPORT FISH RESTORATION ACCOUNT. [Legislation]
This amendment would extend through fiscal year 2011 the authorization for Federal gasoline excise taxes from non-business use of small-engine outdoor power equipment to be transferred from the Highway Trust Fund to the Sport Fish Restoration Account of the Aquatic Resources Trust Fund. These funds are authorized to carry out the purposes of the Coastal Wetlands Planning, Protection, and Restoration Act (Title III of Pub. L. 101-646, Nov. 29, 1990, 104 Stat. 4778).
SEC. 9008. TECHNICAL CORRECTION. [Legislation]
This section would correct a technical error in the 1998 amendments to section 9504(b)(2) of the Trust Fund Code authorizing expenditures from the Sport Fish Restoration Account. It would conform section 9504(b)(2) to the provision in section 9503(c)(5) that small engine fuel tax revenues may be expended only to carry out the purposes of the Coastal Wetlands Planning, Protection, and Restoration Act.
SEC. 9009. TRANSFER BY REGISTERED PIPELINE, VESSEL, OR BARGE REQUIRED FOR FUEL TAX EXEMPTION OF BULK TRANSFERS TO REGISTERED TERMINALS OR REFINERIES; DISPLAY OF REGISTRATION REQUIREMENT. [Legislation]
Federal excise taxes on motor fuels represent the most significant portion of revenues into the Highway Trust Fund. Fuel tax evasion is responsible for a substantial amount of lost revenue. This provision and the provisions that follow propose changes to the Internal Revenue Code intended to prevent or reduce evasion of highway fuel taxes and to improve the collection process for all highway user taxes.
This provision would facilitate tracking of bulk transfers of taxable fuel by amending the Internal Revenue Code to: require that only fuel transferred by registered pipeline, vessel, or barge would qualify for the fuel tax exemption of bulk transfers to registered terminals or refineries; impose an assessable penalty on persons who fail to register as required; require that anyone required to register for transportation of taxable fuels must display a proof of registration on any vessel or barge used in transporting taxable fuel; and impose a civil penalty for failure to display the proof of registration on the vessel or barge. The penalty for failure to register would be $1,000 for each day in which an unregistered person engages in an activity for which registration is required, and the penalty for failure to display proof of registration would be $500. Penalties would increase for additional violations. Joint and several liability would apply for any person or entity willfully participating in a violation of the proposed requirement to register for transportation of taxable fuels.
SEC. 9010. RETURNS FILED ELECTRONICALLY. [Legislation]
This provision would require any person or entity having 25 or more reportable transactions per month to meet information reporting requirements by filing electronically for fuel tracking purposes. A person or entity required to file a heavy vehicle use tax return who has more than 25 vehicles would also be required to file electronically. The filing format would be determined by the Secretary of the Treasury.
The automated fuel reporting system mandated by Congress in TEA-21 has the ability to provide data to the States to support their fuel tax audit and enforcement efforts. If files are received electronically, States would receive complete destination State data, something they requested when the system was under development, whereas paper filing permits only summary data to be entered into the automated system. Electronic tracking of taxable fuels and taxes paid would make tax fraud and evasion much more difficult.
SEC. 9011. CIVIL PENALTY FOR REFUSAL OF ENTRY. [Legislation]
This provision would impose an assessable penalty on any refusal to allow inspections related to taxable fuel that are now authorized by section 4083(c). This proposal would enhance the ability of the IRS to enforce Federal fuel taxes.
SEC. 9012. REQUIREMENT OF TAX PAYMENT DECAL; ELIMINATION OF INSTALLMENT PAYMENTS OF HIGHWAY USE TAX. [Legislation]
This provision would amend the Internal Revenue Code regarding payment of highway use tax on motor vehicles at or above a taxable gross weight of 55,000 pounds to add a requirement that a proof of payment decal/tax certificate be displayed on such vehicles to show that the tax has been paid. The decal, fitted with a bar code, would allow for automatic reading of the truck registration data as envisioned by the Commercial Vehicle Information Systems and Networks (CVISN), and would also be an integral part of the Smart Borders initiatives headed up by the U.S. Customs Service. A civil penalty of $50 would be imposed for a violation of the display requirement.
This provision would also eliminate the option of paying the heavy vehicle highway use tax in quarterly installments. Installment payments have provided an opportunity for tax evasion by allowing an owner to register a vehicle for the entire tax year after payment of only the first installment of the annual tax.
SEC. 9013. ADDITIONAL RULES REGARDING INSPECTIONS OF RECORDS. [Legislation]
This provision would amend the Internal Revenue Code to require that copies of Federal fuel tax records be furnished to State or local fuel tax enforcement officers upon request, whether they are part of the State Revenue Department or of another enforcement agency such as the DOT or the State police. In addition, this provision would require that certain records relating to the highway use tax on vehicles with a taxable gross weight of 55,000 pounds or above be available for inspection by other Federal or State enforcement agencies with responsibilities for such vehicles or taxes. Sharing of information between enforcement agencies increases the number of agents looking for evasion, and improves the opportunity to stop evasion at levels beyond the revenue agencies.