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Fact Sheets on Highway Provisions
HIGHWAY USE TAX EVASION PROJECTS
The program funds projects to reduce motor fuel tax evasion.
SAFETEA-LU Section(s): 1101(a)(21), 1115, and 11141, 11145
Other: 23 USC 143
Of the amount authorized $2M annually is for intergovernmental activities relating to preventing tax evasion. Funds are also provided to the Internal Revenue Service (IRS). No funding is specifically provided for the States, although States are permitted to use up to ¼ of 1 percent of their Surface Transportation Program funding for fuel tax evasion activities. 
Eligible Use of Funds
Funds under this section may be used to:
The use of funds to support efforts to address State/Indian tribe motor fuel tax issues, and to implement programs to reduce evasion associated with foreign imported fuel are new eligibilities under this program. In addition, the Secretary and the Commissioner of the IRS are required, within 90 days, to enter into a new memorandum of understanding (MOU) supporting the joint efforts related to motor fuel tax compliance. This MOU is required to address:
The IRS is required to develop and maintain these systems under contract. The systems are to be available to State and federal revenue, tax, and law enforcement authorities subject to 26 USC 6103, confidentiality and disclosure of returns and return information. The IRS Commissioner is to provide an annual report to the Secretary on the status of these projects. In addition, the Commissioner and the States are to submit an annual report to the Secretary describing the projects, examinations, and criminal investigations funded under this program, as well as the yield from them.
The Federal share is 100 percent.