Taxation of special fuel.

Authors: Senator Greg Walker, Senator Ed Charbonneau

Co-authors: Senator John Broden

Digest

Eliminates the sales tax on the sale of all special fuel that is subject to the special fuel gallonage tax except for: (1) liquid natural gas or compressed natural gas through 2016; (2) natural gas or an alternative fuel commonly or commercially known or sold as butane or propane; and (3) dyed special fuel. Repeals the law concerning precollection of sales tax on special fuel. Increases the gallonage tax on special fuel from $0.16 to $0.27 per gallon. Eliminates the motor fuel surcharge tax on special fuel. Reduces the amount of sales tax deposited in the motor vehicle highway account from 1% of collections to 0.5% of collections. Provides that 65% of the money in the highway, road, and street fund shall be distributed to the state highway fund and 35% of the money in the highway, road, and street fund shall be distributed to the local road and street account. (Current law provides that 55% is distributed to the state highway fund and 45% is distributed to the local road and street account.) Provides that biodiesel fuel that is manufactured in Indiana and shipped out of state is exempt from the special fuel tax and motor carrier fuel tax. (Under current law, a refund must be claimed.) Adjusts distributions to the motor carrier regulation fund.