GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1995

H	1 

HOUSE BILL 277*

Short Title:  Fuel Tax for Alternative Fuels.	(Public)

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Sponsors: Representatives Brawley, Bowen, McLaughlin, and Robinson.

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Referred to:  Finance.

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February 23, 1995

A BILL TO BE ENTITLED
AN ACT TO REDUCE THE MOTOR FUEL TAX FOR ALTERNATIVE TRANSPORTATION FUELS.
The General Assembly of North Carolina enacts:
Section 1.  Article 36 of Chapter 105 of the General Statutes is amended by adding a new section to read:
"§ 105-436.2.  Taxation on alcohol fuels.
Sale, distribution, or use of methanol, denatured ethanol, or other alcohols, or mixtures containing at least seventy percent (70%) by volume of methanol, denatured ethanol, and other alcohols with gasoline or other fuels, used to propel a vehicle on the highways of this State, is subject to the tax under G.S. 105-434 except the tax is twelve cents (12¢)."
Sec. 2.  G.S. 105-449.16 reads as rewritten:
"§ 105-449.16.  Levy of tax and application of tax proceeds.
(a)	A tax is imposed upon all of the following fuel:
(1)	Fuel sold or delivered by a supplier to a licensed user-seller.
(2)	Fuel used by a supplier in a motor vehicle owned, leased, or operated by the supplier.
(3)	Fuel delivered by a supplier directly into the fuel supply tank of a motor vehicle.
(4)	Fuel imported by a user-seller into this State, by a means other than carrying the fuel in a fuel supply tank of a motor vehicle, for resale or to operate a motor vehicle.
(5)	Fuel acquired tax free by a user-seller or user in this State for resale or to operate a motor vehicle.
The tax on liquid fuel that is not an alternative fuel is at the rate established under G.S. 105-434.  The tax on liquid alternative fuel is twelve cents (12¢).  The tax on non-liquid fuel is at a rate equivalent to the rate of tax on liquid fuel, as determined by the Secretary. A supplier who consigns fuel to a reseller may elect to report and pay the tax due on the fuel when the reseller sells or dispenses the fuel instead of when the supplier delivers the fuel to the reseller.
The primary purposes of this levy and this Article are to provide a more efficient and effective method of collecting the tax now imposed and collected pursuant to G.S. 105-435, by providing for the collection of the tax from the supplier instead of the user. The tax levied by this Article is in lieu of rather than in addition to the tax levied by G.S. 105-435; payment of the tax levied by this Article constitutes compliance with G.S. 105-435.
(b)	The same percentage amounts of revenue collected under this Article shall be credited to the Highway Fund and to the Highway Trust Fund as are credited to those Funds under G.S. 105-445, and the same percentage amounts of refunds allowed under this Article shall be charged to the Highway Fund and to the Highway Trust Fund as are charged to those Funds under that statute.
(c)	Expired.
(d)	As used in this section, 'alternative fuel' has the meaning provided in the Energy Policy Act of 1992, 42 U.S.C. § 13201, et seq., except alternative fuel does not include methanol, denatured ethanol, and other alcohols, or mixtures containing at least seventy percent (70%) by volume of methanol, denatured ethanol, and other alcohols with gasoline or other fuels."
Sec. 3.  G.S. 105-435(a) reads as rewritten:
"(a)	Every person who owns or operates over the highways of this State, any motor vehicle that uses any product for propulsion not included within the definition of 'motor fuels' provided in G.S. 105-430, to generate power for the propulsion of the vehicle, shall pay to the Secretary of Revenue, for the use of the highways of this State, a tax at the rate provided in G.S. 105-434(a) on the fuel."
Sec. 4.  This act is effective for taxable years beginning on or after January 1, 1995.