MISSISSIPPI LEGISLATURE
2007 Regular Session
To: Finance
By: Senator(s) Robertson
AN ACT TO AMEND SECTION 27-55-5, MISSISSIPPI CODE OF 1972, TO DEFINE "ETHANOL," "ETHANOL PRODUCER" AND "GASOHOL" FOR PURPOSES OF THE GASOLINE TAX LAW AND TO CLARIFY THE DEFINITION OF GASOLINE; TO CREATE NEW SECTION 27-55-8, MISSISSIPPI CODE OF 1972, TO REQUIRE PERSONS OPERATING A FACILITY THAT PRODUCES ETHANOL TO OBTAIN AN ETHANOL PRODUCERS PERMIT FROM THE STATE TAX COMMISSION; TO REQUIRE A PERSON WHO BLENDS ETHANOL, METHANOL OR ANY OTHER PRODUCT WITH GASOLINE TO OBTAIN A BLENDERS PERMIT FROM THE STATE TAX COMMISSION; TO AMEND SECTION 27-55-11, MISSISSIPPI CODE OF 1972, TO REMOVE THE REQUIREMENT THAT TANKS INTO WHICH GASOLINE IS DISCHARGED TO HAVE CORRECT GAUGE TABLES LISTING CAPACITY PREPARED BY A CALIBRATING AGENCY APPROVED BY THE STATE TAX COMMISSION; TO SPECIFY THE POINT AT WHICH THE GASOLINE EXCISE TAX ACCRUES ON ETHANOL; TO REQUIRE CERTAIN REPORTS TO THE STATE TAX COMMISSION REGARDING SALES AND DELIVERIES OF ETHANOL; TO AMEND SECTION 27-55-19, MISSISSIPPI CODE OF 1972, TO REMOVE THE EXCISE TAX EXEMPTION FOR GASOLINE EXPORTED BY PERSONS TO A DESTINATION BEYOND THE BORDERS OF THIS STATE; TO CLARIFY CERTAIN PROVISIONS RELATING TO REFUNDS OF THE GASOLINE TAX; TO AMEND SECTION 27-55-45, MISSISSIPPI CODE OF 1972, TO REMOVE THE $25,000.00 LIMIT ON THE CREDIT THAT MAY BE TAKEN BY A PERSON AGAINST SUBSEQUENT TAX REPORTS IN THE EVENT TAXES OR PENALTIES IMPOSED UNDER THE GASOLINE TAX LAW HAVE BEEN ILLEGALLY OR ERRONEOUSLY COLLECTED FROM HIM; TO CREATE NEW SECTION 27-55-67, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE PROVISIONS OF THE GASOLINE TAX LAW SHALL NOT APPLY TO CERTAIN PRODUCERS OF ETHANOL WHO PRODUCE ETHANOL EXCLUSIVELY FOR THEIR OWN MOTOR VEHICLES IF THEY OBTAIN THE PERMIT REQUIRED FOR SUCH PRODUCTION; TO AMEND SECTION 27-55-505, MISSISSIPPI CODE OF 1972, TO INCLUDE BIODIESEL AND BIOFUEL WITHIN THE DEFINITION OF THE TERM "SPECIAL FUEL" IN THE MISSISSIPPI SPECIAL FUEL TAX LAW; TO DEFINE "BIODIESEL," "BIOFUEL," "BIODIESEL PRODUCER," "BIOFUEL PRODUCER" AND "UNDYED KEROSENE" FOR PURPOSES OF THE MISSISSIPPI SPECIAL FUEL TAX LAW AND TO CLARIFY THE DEFINITION OF THE TERM "REFINER"; TO CREATE NEW SECTION 27-55-508, MISSISSIPPI CODE OF 1972, TO REQUIRE PERSONS OPERATING FACILITIES PRODUCING BIODIESEL TO OBTAIN A BIODIESEL PRODUCERS PERMIT FROM THE STATE TAX COMMISSION; TO REQUIRE PERSONS OPERATING FACILITIES PRODUCING BIOFUEL TO OBTAIN A BIOFUEL PRODUCERS PERMIT FROM THE STATE TAX COMMISSION; TO REQUIRE ANY PERSON WHO BLENDS BIODIESEL, BIOFUEL OR ANY OTHER PRODUCT TO PRODUCE SPECIAL FUEL TO OBTAIN A BLENDERS PERMIT; TO AMEND SECTION 27-55-519, MISSISSIPPI CODE OF 1972, TO CLARIFY THE EXCISE TAX ON BIODIESEL, BIOFUEL AND BLENDS OF SUCH FUEL AND DIESEL; TO AMEND SECTION 27-55-521, MISSISSIPPI CODE OF 1972, TO CLARIFY THE EXCISE TAX ON BIODIESEL AND BIOFUEL; TO AMEND SECTION 27-55-527, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT BIODIESEL OR BIOFUEL SHALL NOT BE SUBJECT TO THE SPECIAL FUEL TAX UNTIL BLENDED WITH PETROLEUM DIESEL FUEL OR ANY OTHER PRODUCT OR IS SOLD FOR USE AS FUEL AND TO PROVIDE FOR A REFUND OF THE SPECIAL FUEL TAX WHEN AN EXEMPT SALE OCCURS AND THE TAX HAS ALREADY BEEN PAID; TO CREATE NEW SECTION 27-55-571, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE PROVISIONS OF THE MISSISSIPPI SPECIAL FUEL TAX LAW SHALL NOT APPLY TO CERTAIN PRODUCERS OF BIODIESEL AND BIOFUEL WHO PRODUCE BIODIESEL OR BIOFUEL EXCLUSIVELY FOR THEIR OWN MOTOR VEHICLES IF THEY OBTAIN THE PERMIT REQUIRED FOR SUCH PRODUCTION; TO CREATE SECTIONS 27-55-701, 27-55-703, 27-55-705, 27-55-707, 27-55-709, 27-55-711, 27-55-713, 27-55-715, 27-55-717 AND 27-55-719, MISSISSIPPI CODE OF 1972, TO PROVIDE FOR THE REGULATION BY THE STATE TAX COMMISSION OF PRODUCERS OF FUEL ALCOHOL, BIODIESEL OR BIOFUEL WHO PRODUCE SUCH FUEL FOR USE EXCLUSIVELY IN THEIR OWN MOTOR VEHICLES AND PRODUCE LESS THAN 5,000 GALLONS OF FUEL ANNUALLY; TO IMPOSE AN ANNUAL PERMIT FEE ON PRODUCERS OF SUCH FUEL AND ON PERSONS WHO INSTALL A BIOFUEL CONVERSION KIT OR ANY OTHER DEVICE CAPABLE OF PRODUCING FUEL ON THEIR MOTOR VEHICLE; TO PROVIDE PENALTIES FOR FAILURE TO PAY THE REQUIRED PERMIT FEES AND TO PROVIDE PENALTIES FOR THE SALE OR DISTRIBUTION OF SUCH FUEL; TO REQUIRE SUCH PRODUCERS TO MAINTAIN CERTAIN RECORDS; TO AUTHORIZE THE AGENTS AND EMPLOYEES OF THE STATE TAX COMMISSION TO HAVE FULL ACCESS AT ALL REASONABLE HOURS TO BUILDINGS WHERE SUCH FUEL IS PRODUCED; TO AUTHORIZE AGENTS AND EMPLOYEES OF THE STATE TAX COMMISSION AND THE MISSISSIPPI DEPARTMENT OF TRANSPORTATION TO INSPECT ANY MOTOR VEHICLE EQUIPPED WITH A BIOFUEL CONVERSION KIT OR ANY OTHER DEVICE CAPABLE OF PRODUCING FUEL ON THEIR MOTOR VEHICLE; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 27-55-5, Mississippi Code of 1972, is amended as follows:
27-55-5. The words, terms and phrases as used in this article shall have the following meanings unless the context requires otherwise:
(a) "Gasoline" means:
(i) All products commonly or commercially known or sold as gasoline (excluding casinghead and absorption or natural gasoline) regardless of their classification or uses; * * *
(ii) Any liquid prepared, advertised, offered for sale or sold for use as or commonly and commercially used as a fuel in internal combustion engines, which when subjected to distillation in accordance with the standard method of test for distillation of gasoline, naphtha, kerosene and similar petroleum products (American Society for Testing Materials Designation D-86) shows not less than ten percent (10%) distilled (recovered) below two hundred sixty (260) degrees Fahrenheit and not less than ninety-five percent (95%) distilled (recovered) below four hundred sixty-four (464) degrees Fahrenheit;
(iii) Ethanol;
(iv) Any blend of gasoline and ethanol or any blend of gasoline and blend stock; and
(v) Gasohol.
The term "gasoline" shall include "aviation gasoline."
The term "gasoline" shall not include:
(i) Liquefied gases which would not exist as liquid at a temperature of sixty (60) degrees Fahrenheit and at a pressure of fourteen and seven-tenths (14.7) pounds per square inch absolute;
(ii) Commercial solvents or naphthas or raw petroleum products or petrochemicals intermediates when used as or sold for use in production or manufacture of plastics, detergents, synthetic rubber, herbicides or other chemicals or products which are not prepared, advertised, offered for sale or sold for use or suitable for use as fuel for generating power in internal combustion engines;
(iii) Racing gasoline.
(b) "Aviation gasoline" means gasoline refined or manufactured, according to the specifications for aviation gasoline set forth in ASTM D-910, for exclusive use in reciprocating aviation engines.
(c) "Person" means any individual, firm, copartnership, joint venture, association, corporation, estate, trust or any other group or combination acting as a unit, and the plural as well as the singular number unless the intention to give a more limited meaning is disclosed by the context.
(d) "Distributor of gasoline" means:
(i) Any person importing gasoline into this state;
(ii) Any person receiving, purchasing, acquiring, using, storing or selling any gasoline in this state on which the gasoline excise tax imposed by this article has not been paid;
(iii) Refiners, blenders, marine terminal operators, pipeline terminal operators or ethanol producers; and
(iv) Any person licensed to sell gasoline in another state or jurisdiction who is authorized by that state or jurisdiction to collect the gasoline excise tax imposed by this article.
(e) "Highway" means every way or place, of whatever nature including public roads, toll roads, streets and alleys of this state generally open to the use of the public or to be opened or reopened to the use of the public for the purpose of vehicular travel, and notwithstanding that the same may be temporarily closed for the purpose of construction, reconstruction, maintenance or repair. The confines of a highway shall include the entire width and length of the right-of-way.
(f) "Refiner" means every person who manufactures finished petroleum products from crude oil, unfinished oils, natural gas liquids or other hydrocarbons * * *.
(g) "Bonded distributor of gasoline" means any person holding a valid gasoline distributor's permit issued by the commission.
(h) "For agricultural or maritime purposes" means gasoline used:
(i) In operating farm tractors or other farm equipment used exclusively in plowing, planting or harvesting farm products, or in operating boats, and no part of which is used in any motor vehicle or equipment driven or operated upon the public roads, streets or highways of this state; and
(ii) As a fuel in a farm tractor using the highways solely in hauling or transporting farm products of the soil from the farm to a gin or market where the title to such products is still in the producer, or in transporting fertilizer or feed to the farm, where the title to such products is still in the user.
(i) "For industrial purposes" means gasoline used in engines or motors of stationary or portable type for the purpose of operating machinery used for manufacturing or used for industrial purposes, and no part of which machinery is driven or operated upon the public roads, streets or highways of this state.
(j) "For domestic purposes" means gasoline used for any other purpose than agricultural, maritime, industrial or manufacturing, and no part of which is used for operating motor vehicles or motor-propelled machines of any description along the public roads, streets, alleys or highways (as defined in this article) of this state.
(k) "For nonhighway purposes" means gasoline used for any other purpose than agricultural, maritime, industrial, manufacturing or domestic purposes, and no part of which is used for operating motor vehicles or motor-propelled machines of any description along the public roads, streets, alleys or highways (as defined in this article) of this state.
(l) "For aviation purposes" means gasoline used for the operation of aircraft.
(m) "Refund gasoline" means gasoline used or to be used for agricultural, maritime, industrial, manufacturing, domestic or nonhighway purposes only, as these terms are defined in this article.
(n) "Commission" means the State Tax Commission, acting either directly or through its duly authorized officers, agents or employees.
(o) "United States government" means and includes all purchasing officers of the Armed Forces of the United States and the United States Property and Fiscal Officer for the State of Mississippi or any other state appointed pursuant to Section 708, Title 32, United States Code, when purchasing gasoline with federal funds for the account of and use by a component of the Armed Forces as herein defined.
(p) "Armed Forces" means and includes all components of the Armed Forces of the United States including the Army National Guard, the Army National Guard of the United States, the Air National Guard and the Air National Guard of the United States, as those terms are defined in Section 101, Title 10, United States Code, and any other reserve component of the Armed Forces of the United States enumerated in Section 261, Title 10, United States Code.
(q) "Blend stock" means * * * methanol or any other products blended with gasoline to produce motor fuel.
(r) "Blender" means any person other than a refiner who blends blend stock or ethanol with gasoline or who sells or distributes blend stock for the purpose of being blended with gasoline.
(s) "Racing gasoline" means gasoline manufactured exclusively for use in racing and gasoline containing lead, or having an octane rating of 105 or higher that is not suitable for use on the highways.
(t) "Ethanol" means alcohol derived from grain or other agricultural products of any biomass that meets American Society of Testing Materials (ASTM) designation D-4806-956 and is denatured according to federal regulations.
(u) "Ethanol producer" means the operator of a facility producing ethanol.
(v) "Gasohol" means a blend of gasoline and ethanol.
SECTION 2. The following provision shall be codified as Section 27-55-8, Mississippi Code of 1972:
27-55-8. (1) Any person operating a facility producing ethanol shall be required to obtain an ethanol producers permit.
(2) Any person who blends ethanol, methanol or any other product with gasoline to produce motor fuel shall be required to obtain a blenders permit.
(3) Application for the permits prescribed by this section shall be made on forms and in a manner prescribed by the commission.
SECTION 3. Section 27-55-11, Mississippi Code of 1972, is amended as follows:
27-55-11. (1) Any person in business as a distributor of gasoline or who acts as a distributor of gasoline, as defined in this article, shall pay for the privilege of engaging in such business or acting as such distributor an excise tax equal to Eighteen Cents (18¢) per gallon until the date specified in Section 65-39-35, and Fourteen and Four-tenths Cents (14.4¢) per gallon thereafter, on all gasoline and blend stock stored, sold, distributed, manufactured, refined, distilled, blended or compounded in this state or received in this state for sale, use on the highways, storage, distribution, or for any purpose.
(2) Any person in business as a distributor of aviation gasoline, or who acts as a distributor of aviation gasoline, shall pay for the privilege of engaging in such business or acting as such distributor an excise tax equal to Six and Four-tenths Cents (6.4¢) per gallon on all aviation gasoline stored, sold, distributed, manufactured, refined, distilled, blended or compounded in this state or received in this state for sale, storage, distribution or for any purpose.
(3) The excise taxes collected under this section shall be paid and distributed in accordance with Section 27-5-101.
(4) The tax herein imposed and assessed shall be collected and paid to the State of Mississippi but once in respect to any gasoline. The basis for determining the tax liability shall be the correct invoiced gallons, adjusted to sixty (60) degrees Fahrenheit at the refinery or point of origin of shipment when such shipment is made by tank car or by motor carrier.
(5) The point of origin of shipment of gasoline transported into this state by pipelines shall be deemed to be that point in this state where such gasoline is withdrawn from the pipeline for storage or distribution, and adjustment to sixty (60) degrees Fahrenheit shall there be made.
(6) The basis for determining the tax liability on gasoline shipped into this state in barge cargoes and by pipeline shall be the actual number of gallons adjusted to sixty (60) degrees Fahrenheit unloaded into storage tanks or other containers in this state, such gallonage to be determined by measurement and/or gauge of storage tank or tanks or by any other method authorized by the commission. * * *
(7) The tax levied herein shall accrue at the time gasoline is withdrawn from a refinery in this state except when withdrawal is by pipeline, barge, ship or vessel. The refiner shall pay to the commission the tax levied herein when gasoline is sold or delivered to persons who do not hold gasoline distributor permits. The refiner shall report to the commission all sales and deliveries of gasoline to bonded distributors of gasoline. The bonded distributor of gasoline who purchases, receives or acquires gasoline from a refinery in this state shall report such gasoline and pay the tax levied herein.
(8) Gasoline imported by common carrier shall be deemed to be received by the distributor of gasoline, and the tax levied herein shall accrue, when the car or tank truck containing such gasoline is unloaded by the carrier.
(9) With respect to distributors or other persons who bring, ship, have transported, or have brought into this state gasoline by means other than through a common carrier, the tax accrues and the tax liability attaches on the distributor or other person for each gallon of gasoline brought into the state at the time when and at the point where such gasoline is brought into the state.
(10) The tax levied herein shall accrue at the time ethanol is withdrawn from an ethanol production facility in this state. The ethanol producer shall pay to the commission the tax levied herein when ethanol is sold or delivered to persons who do not hold gasoline distributor permits. The ethanol producer shall report to the commission all sales and deliveries of ethanol to bonded distributors of gasoline. The bonded distributor who purchases, receives or acquires ethanol from an ethanol production facility in this state shall report such ethanol and pay the tax levied herein.
(11) The tax levied herein shall accrue on blend stock at the time it is blended with gasoline. The blender shall pay to the commission the tax levied herein when blend stock is sold or delivered to persons who do not hold gasoline distributor permits. The blender shall report to the commission all sales and deliveries of blend stock to bonded distributors of gasoline. The bonded distributor of gasoline who purchases, receives or acquires blend stock from a blender in this state shall report blend stock and pay the tax levied herein.
SECTION 4. Section 27-55-19, Mississippi Code of 1972, is amended as follows:
27-55-19. (1) There shall not be included in the measure of the tax levied hereunder any gasoline:
(a) Sold or delivered by a bonded distributor of gasoline to a second bonded distributor of gasoline within this state, but nothing in this exclusion shall exempt the second bonded distributor of gasoline from paying the tax, unless the second bonded distributor of gasoline sells or delivers said gasoline to a third bonded distributor of gasoline in which event the third bonded distributor of gasoline shall be liable for the tax.
(b) Sold to the United States government for use of the Armed Forces only, and delivered in quantities of not less than four thousand (4,000) gallons. Any exemption provided in this paragraph (b) may be deducted without the prior approval of the commission, provided that satisfactory proof of such exemption shall be furnished to the commission. However, the exemption may be disallowed by the commission if the distributor fails to furnish satisfactory proof of the exemption to the commission.
(c) Exported to a destination beyond the borders of this state by a bonded distributor of gasoline when the tax on the gasoline has been paid or on which the tax liability imposed by this article has accrued against the bonded distributor. Any exemption provided in this paragraph (c) may be deducted without the prior approval of the commission, provided that satisfactory proof of the exemption shall be furnished to the commission; however, such exemption may be disallowed by the commission if the distributor fails to furnish satisfactory proof of the exemption to the commission within ninety (90) days from the sale or delivery of the gasoline.
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(d) Imported by, or sold to, any refiner or processor in this state for the purpose of being refined or further processed.
(e) Sold to any manufacturer for blending or compounding to the end that it becomes a component part of any manufactured product, or where used as a processing agent in the treatment of raw material in manufacturing a product which does not fall within the meaning of the term "gasoline" as defined in this article.
(f) Sold or delivered to be used for test purposes at any regularly established testing laboratory in this state.
(2) Except as provided in paragraphs (b) and (c) of subsection (1) of this section, evidence of exempt transactions provided in this section * * *, satisfactory to the commission, shall be submitted by the distributor desiring an allowance of the exemptions to the commission with the payment of the excise tax on the gasoline on which the exemption is claimed. If the commission decides that the distributor is entitled to the exemption and allowance claimed, it shall notify the distributor in writing of the allowance. The distributor shall then be allowed to deduct from the payments made in his next monthly report, after the allowance, the amount of tax which he paid on this exempted gasoline which amount shall be arrived at by taking the amount of exempted gasoline minus two percent (2%) allowed for evaporation, shrinkage and other losses on gasoline, and multiplying the remainder by the amount of excise tax per gallon. In cases where the amount of the tax cannot be absorbed on the estimated tax liability of the distributor during the next six (6) months, the amount shall be refunded to the distributor. The amount shall be certified to the State Auditor of Public Accounts by the commission. The * * * Auditor is hereby authorized to make such investigation and audit of the claim as he finds necessary. If he finds that the commission is correct in its determination, the Auditor may issue his warrant to the State Treasurer in favor of the distributor for the amount of tax * * * paid, the refunds to be made from current gasoline, or special fuel tax collections.
(3) Except as otherwise provided in this section, in order to claim exemptions provided for under this article, the distributor of gasoline must file claims therefor within three (3) years from the date of sale or delivery; otherwise, claims for such exemptions shall be disallowed.
(4) (a) In case gasoline and special fuel on which the tax has been previously paid are accidentally mixed, the distributor of gasoline or other person owning the mixture may ship the mixture out of the State of Mississippi, or to a Mississippi refinery, and may claim credit for the gasoline and/or special fuel tax on the gasoline and special fuel so mixed. The distributor of gasoline or other person may also ship the mixture to a barge or pipeline storage terminal within the State of Mississippi to be brought up to gasoline specifications, or lowered to special fuel specifications, as the case might be, under the supervision of a representative of the commission. It shall be the duty of the distributor of gasoline or other person to whom the mixed product belongs to notify the commission immediately after knowledge that the mixture has occurred.
(b) In case the distributor of gasoline or other person elects to ship the mixture to a barge or pipeline terminal for storage within this state, the commission shall supervise the unloading of the mixture.
(c) In order to perfect a claim for credit for the tax on the gasoline and special fuel constituting any such mixture, the distributor of gasoline or other person making the claim shall do so in writing and shall furnish proof satisfactory to the commission that the mixture was either shipped out of this state or to a refinery or other approved place of storage within this state. The commission shall notify the claimant, in writing, whether or not his claim is approved, and, if approved, the claimant may deduct the amount of the claim from his next tax report. No such claim shall be allowed unless filed within three (3) years after the date of such accidental mixture. Bonded distributors of gasoline having no gasoline tax liability with the commission may assign such tax credit to a bonded distributor of gasoline having such tax liability.
(5) No tax liability shall accrue against the operator of a refinery when shipments of gasoline are made from the refinery, either by common carrier or by tank trucks owned and operated by the operator of said refinery, to a tax-exempt account within this state or to another refinery within this state; * * * however, * * * when gasoline is withdrawn from the storage tank of a refiner or processor on which the tax is paid on such gasoline and it or any part thereof cannot be delivered to a purchaser, the refiner or processor may deduct the tax on all or that portion of the gasoline not delivered to a purchaser from its next gasoline distributor's tax report; provided that the refiner or processor submits with the tax report: (a) a written report setting forth the reasons why the delivery could not be made, and (b) proof or evidence satisfactory to the commission that the tax in question had theretofore been paid to the commission, and (c) proof or evidence satisfactory to the commission that the nondelivered gasoline was actually returned to the refinery or processor from which it was taken for the purpose of delivering it to a purchaser; and provided further, that immediately upon ascertainment by the refiner or processor that said gasoline cannot be delivered, he or it shall immediately notify the commission of this fact and before moving his or its truck or other means of transporting the gasoline from the intended point of delivery; and should the commission desire to inspect the truck, or other means of conveyance, the refiner or processor shall arrange for the inspection at the point or at such other point that may be designated by the commission.
(6) The United States government, the State of Mississippi, counties, municipalities, school districts and all other political subdivisions of the state and volunteer fire departments chartered under the laws of the State of Mississippi as nonprofit corporations shall be exempt from Five and Four-tenths Cents (5.4¢) of the portion of the gasoline excise tax rate which exceeds Nine Cents (9¢) per gallon. Any exemption provided in this subsection may be deducted without the prior approval of the commission.
SECTION 5. Section 27-55-45, Mississippi Code of 1972, is amended as follows:
27-55-45. In the event that any taxes or penalties imposed by this article have been erroneously or illegally collected from a distributor of gasoline or other person, the commission may, upon approval by the commission, permit the distributor or other person to take credit against a subsequent tax report for the amount of the erroneous overpayment or the amount thereof may be refunded to the distributor or other person in the same manner as provided in Section 27-55-19. * * *
No refunds shall be made under the provisions of this section unless a written claim is filed setting forth the circumstances by reason of which such refund should be allowed. The claim shall be in such form as the commission shall prescribe, and shall be filed with the commission within three (3) years from the date of payment of the taxes erroneously or illegally collected. Nothing in this article shall be construed to prohibit a refund or credit for tax paid on gasoline not subject to tax or which is exempt from tax, provided there has not been a willful disregard of the provisions of this article and further provided that the claim therefor is filed within three (3) years.
SECTION 6. The following provision shall be codified as Section 27-55-67, Mississippi Code of 1972:
27-55-67. The provisions of this article relating to ethanol producers shall not apply to persons producing ethanol exclusively for use in their own motor vehicles who have obtained a permit from the commission under the provision of Sections 27-55-701, et seq., and whose annual production is less than five thousand (5,000) gallons.
SECTION 7. Section 27-55-505, Mississippi Code of 1972, is amended as follows:
27-55-505. The words, terms and phrases as used in this article shall have the following meanings unless the context requires otherwise:
(a) "Special fuel" means kerosene, diesel fuel, fuel oils, * * * any petroleum fuel, biodiesel, biofuel and blends of petroleum diesel and biodiesel or biofuel or any other product other than gasoline or compressed gas which is usable as fuel in an internal combustion engine, and any combustible liquid other than gasoline or compressed gas used or capable of being used as a fuel in aircraft. The term "special fuel" shall not include racing gasoline as defined in Section 27-55-5.
(b) "Bunker oil" means a residual product obtained in the refining of crude petroleum intended for use for the generation of heat in a firebox or furnace when its flash point, as determined by use of the Pensky-Martens tester, shall not be less than one hundred fifty (150) degrees Fahrenheit and when its viscosity at one hundred (100) degrees Fahrenheit shall not be less than one hundred fifty (150) seconds when determined by use of the Saybolt Universal Tubes.
(c) "Person" means any individual, firm, copartnership, joint venture, association, corporation, estate, trust, or any group or combination acting as a unit, and the plural as well as the singular number unless the intention to give a more limited meaning is disclosed by the context.
(d) "Distributor of special fuel" means:
(i) Any person importing special fuel into this state;
(ii) Any person who shall receive, purchase, acquire, use, store or sell any special fuel in this state on which the excise tax hereinafter imposed by this article has not been paid;
(iii) Any person exporting special fuel;
(iv) Any person engaged in the distribution of special fuel by tank car or tank truck or both;however, no person may qualify as a distributor of special fuel for the sole purpose of using special fuel, as defined in this article, as a fuel to propel a vehicle or vehicles owned or operated by him on the highways of this state; and
(v) All persons meeting the definition of "refiners," "processors," "terminal operator," "blenders," "biodiesel producer," "biofuel producer" and any person licensed to sell motor fuel in another state or jurisdiction who is authorized by that state or jurisdiction to collect the special fuel excise tax imposed by this article.
(e) "Bonded distributor of special fuel" means any person holding a valid distributor of special fuel permit issued by the State Tax Commission.
(f) "Refiner" * * * means every person who manufactures finished petroleum products from crude oil, unfinished oils, natural gas liquids or other hydrocarbons * * *.
(g) "For nonhighway purposes" means special fuel which is not used for operating motor vehicles or motor-propelled machines of any description along the public roads, streets, alleys or highways of this state as defined in this article.
(h) "Highway" means every way or place of whatever nature, including public roads, toll roads, streets and alleys of this state generally open to the use of the public or to be opened or reopened to the use of the public for the purpose of vehicular travel, and notwithstanding that they may be temporarily closed for the purpose of construction, reconstruction, maintenance or repair. The confines of a highway shall include the entire width and length of the right-of-way.
(i) "Commission" means the State Tax Commission of the State of Mississippi, acting either directly or through its duly authorized officers, agents or employees.
(j) "Terminal" means a tank farm within the State of Mississippi with storage capacity for the receipt of a full barge delivery or common carrier pipeline delivery of taxable petroleum products when the products are to be distributed within the state.
(k) "Marine dealer" means any person selling special fuel from marine or dockside storage facilities when the special fuel is for use in boats, vessels, barges or ships.
(l)"United States government" means and includes all purchasing officers of the Armed Forces of the United States and the United States Property and Fiscal Officer for the State of Mississippi or any other state appointed pursuant to Section 708, Title 32, United States Code, when purchasing special fuel with federal funds for the account of and use by a component of the Armed Forces as herein defined.
(m) "Armed Forces" means and includes all components of the Armed Forces of the United States including the Army National Guard, the Army National Guard of the United States, the Air National Guard and the Air National Guard of the United States, as those terms are defined in Section 101, Title 10, United States Code, and any other reserve component of the Armed Forces of the United States enumerated in Section 261, Title 10, United States Code.
(n) "Motor vehicle" means every vehicle designed, constructed for or used on the highways of this state which is self-propelled, except a farm tractor using the highways solely in hauling or transporting farm products of the soil from the farm to a gin or market when the title to such products is still in the producer, or a farm tractor used in transporting fertilizer or food to a farm when the title to such products is still in the user.
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(o) "Retail dealer" means any person who operates a retail station.
(p) "Dyed diesel fuel" means diesel fuel that is dyed in accordance with United States Environmental Protection Agency or Internal Revenue Service requirements.
(q) "Dyed kerosene" means kerosene that is dyed in accordance with United States Environmental Protection Agency or Internal Revenue Service requirements.
(r) "Undyed diesel fuel" means diesel fuel that does not meet the dyeing requirements prescribed by United States Environmental Protection Agency or Internal Revenue Service Regulations.
(s) "Fuel oil" means a general classification for one of the petroleum fractions produced in conventional distillation operations. For the purposes of this article, "fuel oil" is No. 1, No. 2 and No. 4 fuel oils and No. 1, No. 2 and No. 4 diesel fuels.
(t) "Blender" shall mean any person who blends or compounds biodiesel, biofuel or any other product to produce special fuel.
(u) "Terminal operator" means any person who owns, operates or otherwise controls a terminal.
(v) "Biodiesel" means a fuel composed of mono-alkyl esters of long chain fatty acids generally derived from vegetable oils, animal fats or biomass designated B100, and meeting the requirements of American Society of Testing Materials (ASTM) designation D-6751.
(w) "Biofuel" means any product derived from vegetable oil, soybean oil or any other agricultural product of animal fats or biomass that is used as fuel in a diesel engine.
(x) "Biodiesel producer" means the operator of a facility manufacturing biodiesel.
(y) "Biofuel producer" means the operator of a facility manufacturing biofuel.
(z) "Undyed kerosene" means kerosene that does not meet dyeing requirements prescribe by the Internal Revenue Service.
SECTION 8. The following provision shall be codified as Section 27-55-508, Mississippi Code of 1972:
27-55-508. (1) Any person operating a facility producing biodiesel shall be required to obtain an biodiesel producers permit.
(2) Any person operating a facility producing biofuel shall be required to obtain a biofuel producers permit.
(3) Any person who blends biodiesel, biofuel or any other product with gasoline to produce special fuel shall be required to obtain a blenders permit.
(4) Application for the permits prescribed by this section shall be made on forms and in a manner prescribed by the commission.
SECTION 9. Section 27-55-519, Mississippi Code of 1972, is amended as follows:
27-55-519. (1) Any person engaged in business as a distributor of special fuel or who acts as a distributor of special fuel, as defined in this article, shall pay for the privilege of engaging in this business or acting as a distributor an excise tax on all special fuel stored, used, sold, distributed, manufactured, refined, distilled, blended or compounded in this state or received in this state for sale, storage, distribution or for any purpose, adjusted to sixty (60) degrees Fahrenheit.
The excise tax shall become due and payable when:
(a) Special fuel is withdrawn from storage at a refinery, marine or pipeline terminal, except when withdrawal is by barge or pipeline.
(b) Special fuel imported by a common carrier is unloaded by that carrier unless the special fuel is unloaded directly into the storage tanks of a refinery, marine or pipeline terminal.
(c) Special fuel imported by any person other than a common carrier enters the State of Mississippi unless the special fuel is unloaded directly into the storage tanks of a refinery, marine or pipeline terminal.
(d) Special fuel is blended in this state unless such blending occurs in a refinery, marine or pipeline terminal.
(e) Special fuel is acquired tax free.
(2) The special fuel excise tax shall be as follows:
(a) Eighteen Cents (18¢) per gallon on undyed diesel fuel until the date specified in Section 65-39-35 and Fourteen and Three-fourths Cents (14.75¢) per gallon thereafter;
(b) Eighteen Cents (18¢) per gallon on undyed biodiesel, undyed biofuel or blends of undyed biodiesel and undyed diesel or blends of undyed biofuel and undyed diesel until the date specified in Section 65-39-35 and Fourteen and Three-fourths Cents (14.75¢) per gallon thereafter;
(c) Five and Three-fourths Cents (5.75¢) per gallon on all special fuel except undyed diesel fuel, undyed biodiesel, undyed biofuel and blends thereof and special fuel used as fuels in aircraft; and
(d) Five and One-fourth Cents (5.25¢) per gallon on special fuel used as fuel in aircraft.
SECTION 10. Section 27-55-521, Mississippi Code of 1972, is amended as follows:
27-55-521. (1) An excise tax at the rate of Eighteen Cents (18¢) per gallon until the date specified in Section 65-39-35, Mississippi Code of 1972, and Fourteen and Three-fourths Cents (14.75¢) per gallon thereafter is levied on any person engaged in business as a distributor of special fuel or who acts as such who sells:
(a) Special fuel for use in performing contracts for construction, reconstruction, maintenance or repairs, where the contracts are entered into with the State of Mississippi, any political subdivision of the State of Mississippi, or any department, agency, institution of the State of Mississippi or any political subdivision thereof.
(b) Dyed diesel fuel or kerosene to a state or local governmental entity for use on the highways in a motor vehicle.
(c) Special fuel for use on the highway.
(2) An excise tax at the rate of Eighteen Cents (18¢) per gallon until the date specified in Section 65-39-35, Mississippi Code of 1972, and Fourteen and Three-fourths Cents (14.75¢) per gallon thereafter is levied on any person who:
(a) Uses dyed diesel fuel or kerosene in a motor vehicle on the highways of this state in violation of Section 27-55-539.
(b) Purchases or acquires undyed diesel fuel or kerosene for nonhighway use and subsequently uses this diesel fuel or kerosene in a motor vehicle on the highways of this state.
(c) Purchases or acquires special fuel for use in performing contracts as specified in this section.
(3) An excise tax at the rate of Eighteen Cents (18¢) per gallon until the date specified in Section 65-39-35, Mississippi Code of 1972, and Fourteen and Three-fourths Cents (14.75¢) per gallon thereafter is levied on any bonded distributor of special fuel who holds a blenders permit who:
(a) Blends biodiesel or biofuel with undyed diesel fuel.
(b) Sells undyed biodiesel or undyed biofuel.
(4) An excise tax at a rate of Five and Three-fourths Cents (5.75¢) per gallon is levied on any bonded distributor of special fuel who holds a blenders permit who:
(a) Blends biodiesel or biofuel with dyed diesel fuel.
(b) Sells dyed biodiesel or dyed biofuel.
SECTION 11. Section 27-55-527, Mississippi Code of 1972, is amended as follows:
27-55-527. (1) There shall not be included in the measure of the tax levied in this article any special fuel:
(a) Sold or delivered by a bonded distributor of special fuel to a second bonded distributor of special fuel within this state, but nothing in this exclusion shall exempt the second bonded distributor of special fuel from paying the tax unless the second bonded distributor of special fuel sells or delivers said special fuel to a third bonded distributor of special fuel, in which event the third bonded distributor of special fuel shall be liable for the tax.
(b) Sold to the United States government for use of the Armed Forces only, and delivered in quantities of not less than four thousand (4,000) gallons.
(c) Delivered to a bonded warehouse for storage within this state for the United States Department of Interior.
(d) Exported to a destination beyond the borders of this state by a bonded distributor of special fuel when the tax on the special fuel has been paid or on which the tax liability imposed by this article has accrued against such bonded distributor.
(e) Imported by, or sold to, any refiner or processor in this state for the purpose of being refined or further processed.
(f) Sold or delivered to any person within this state to be used as a herbicide or as a solvent for insecticides, wood preservatives and like products, or when so used in a commercial process that they become a component part of any manufactured product or where used as a processing agent in the treatment of raw material in manufacturing any product.
(g) Sold or delivered to be used for test purposes at any regularly established testing laboratory in this state.
(h) Sold to be consumed as fuel by any boat, vessel, ship, towboat or dredgeboat, or sold to the holder of a Marine Dealers Permit for resale or distribution as fuel for a boat, vessel, ship, towboat or dredgeboat.
(i) Sold as bunker oil or sold to be used for the generation of heat in a firebox or furnace.
(j) Sold or delivered to be used for the purpose of generating electricity.
(k) Sold for use as fuel in a railroad locomotive when subject to the tax levied by Section 27-59-301 et seq.
(2) The exemptions set forth in paragraphs (f), (h), (i) and (j) of subsection (1) of this section shall not apply to special fuel used in performing contracts for construction, reconstruction, maintenance or repairs, where the contracts are entered into with the State of Mississippi, any political subdivision of the State of Mississippi, or any department, agency or institution of the State of Mississippi or any political subdivision thereof.
(3) Biodiesel or biofuel sold to, acquired by, imported by or produced by a special fuel distributor who holds a blenders permit is not subject to the tax levied in this article until blended with petroleum diesel fuel or any other product or is sold for use as fuel.
(4) Evidence of exempt transactions provided in this section * * * shall consist of copies of invoices, documents or any other evidence that may be required by the commission.
(5) Any person other than a bonded distributor of special fuel who has delivered or sold special fuel on which the tax has been paid by him to the vendor may, if the special fuel is subject to exemption under this article, assign his claim for exemption to any bonded distributor of special fuel in this state. The distributor may deduct the amount of the tax exemption from his next special fuel report, provided the distributor furnishes evidence satisfactory to the commission that the claim for exemption is valid.
(6) When special fuel is withdrawn from the storage tank of a refiner, processor, marine or pipeline terminal operator and the tax is paid on the special fuel and it or any part thereof cannot be delivered to a purchaser, the refiner, processor, marine or pipeline terminal operator may deduct the tax on all or that portion of the special fuel not delivered to a purchaser from its next special fuel distributor's tax report, provided that the refiner, processor, marine or pipeline terminal operator submits with such tax report: (a) a written report setting forth the reasons why the delivery could not be made, and (b) proof or evidence satisfactory to the commission that the tax in question had theretofore been paid to the commission, and (c) proof or evidence satisfactory to the commission that the nondelivered special fuel was actually returned to the refinery, processor, marine or pipeline terminal from which it was taken for the purpose of delivering it to a purchaser; and provided further, that immediately upon ascertainment by the refiner, processor, marine or pipeline terminal operator that the special fuel cannot be delivered, he or it shall immediately notify the commission of this fact and before moving his or its truck or other means of transporting such special fuel from the intended point of delivery; and should the commission desire to inspect the truck or other means of conveyance, the refiner, processor, marine or pipeline terminal operator shall arrange for the inspection at that point or at such other point that may be designated by the commission.
(7) In order to claim exemptions provided for under this article, the distributor of special fuel must file claims therefor within three (3) years from the date of sale or delivery; otherwise, claims for such exemptions shall be disallowed.
(8) A bonded distributor of special fuel who sells or delivers special fuel subject to an exemption set forth in this section or Section 27-55-12 on which tax has previously been paid, and whose estimated tax liability cannot absorb the amount of tax exempted within six (6) months, shall be entitled to receive a refund of the amount that cannot be absorbed by the estimated tax liability. The amount shall be refunded in the same manner as provided in Section 27-55-19.
SECTION 12. The following provision shall be codified as Section 27-55-571, Mississippi Code of 1972:
27-55-571. The provisions of this article relating to biodiesel and biofuel shall not apply to persons producing biodiesel and biofuel exclusively for use in their own motor vehicles who have obtained a permit from the commission under the provision of Section 27-55-701 et seq., and whose annual production is less than five thousand (5,000) gallons.
SECTION 13. The following provision shall be codified as Section 27-55-701, Mississippi Code of 1972:
27-55-701. The State Tax Commission, hereinafter called the "commission," is vested with the sole power and authority, and is charged with the duty of administering and enforcing the terms and provisions of this article.
SECTION 14. The following provision shall be codified as Section 27-55-703, Mississippi Code of 1972:
27-55-703. The words, terms and phrases as used in this article shall have the following meanings unless the context requires otherwise:
(a) "Fuel alcohol" means alcohol derived from grain or other agricultural products or biomass and is denatured according to federal regulations.
(b) "Fuel alcohol producers" means any person operating a still producing fuel alcohol exclusively for use in their own motor vehicles.
(c) "Biofuel" means any product derived from vegetable oil, soybean oil or any other agricultural product or animal fats or biomass that is usable as fuel in a diesel engine.
(d) "Biofuel producer" means any person producing biofuel for their own use.
(e) "Biofuel conversion kit" means any equipment installed on a motor vehicle that allows the use of biofuel in an internal combustion engine.
(f) "Person" means any individual, firm, copartnership, joint venture, association, corporation, estate, trust or any group or combination acting as a unit, and the plural as well as the singular number unless the intention to give a more limited meaning is disclosed by the text.
(g) "Commission" means the State Tax Commission, acting either directly or through its duly authorized officers, agents or employees.
SECTION 15. The following provision shall be codified as Section 27-55-705, Mississippi Code of 1972:
27-55-705. (1) An annual permit fee is hereby levied upon any person producing fuel alcohol, biodiesel or biofuel exclusively for their own use as follows:
(a) For facilities with an annual production capacity not exceeding two thousand (2,000) gallons shall be One Hundred Fifty Dollars ($150.00).
(b) For facilities with an annual production capacity greater than two thousand (2,000) gallons but less than five thousand (5,000) gallons shall be Three Hundred Dollars ($300.00).
(2) An annual fee of One Hundred Fifty Dollars ($150.00) is hereby levied on each person who installs a biofuel conversion kit or any other device capable of producing fuel on their motor vehicle.
SECTION 16. The following provision shall be codified as Section 27-55-707, Mississippi Code of 1972:
27-55-707. (1) Any person who produces fuel alcohol, biodiesel or biofuel for their own use as a motor fuel and fails to pay the permit fees levied in this article may be subject to a penalty equal to twenty-five percent (25%) of the permit fee.
(2) Any person who operates a motor vehicle with a biofuel conversion kit or other device capable of producing fuel without having paid the permit fee levied in this article may be subject to a penalty equal to twenty-five percent (25%) of the permit fee.
(3) Any person subject to the provisions of this article who sells or distributes fuel alcohol, biodiesel or biofuel may be subject to a penalty of One Thousand Dollars ($1,000.00) for the first offense, and a penalty of Two Thousand Dollars ($2,000.00) for each subsequent offense. Such person shall be subject to the requirements of the Mississippi Gasoline Tax Law and/or the Mississippi Special Fuel Tax Law.
SECTION 17. The following provision shall be codified as Section 27-55-709, Mississippi Code of 1972:
27-55-709. All administrative provisions of the Mississippi Sales Tax Law, including those which fix damages, penalties and interest for nonpayment of taxes, failure to file returns and for other noncompliance with the provisions of that law and all other requirements and duties imposed upon taxpayers shall apply to all persons liable for fees under the provisions of this article, and the commission shall exercise all the powers and authority and perform all the duties with respect to taxpayers under this article as are provided in the Sales Tax Law, except in cases of conflict, then the provisions of this article shall control.
SECTION 18. The following provision shall be codified as Section 27-55-711, Mississippi Code of 1972:
27-55-711. Any person subject to the provisions of this article shall maintain for a period of three (3) years, a record of the quantity of fuel alcohol, biodiesel or biofuel produced each year and of the motor vehicles in which fuel alcohol, biodiesel or biofuel is used.
SECTION 19. The following provision shall be codified as Section 27-55-713, Mississippi Code of 1972:
27-55-713. (1) The commission, its agents and employees, shall have full access, ingress and egress at all reasonable hours to and from any place or building where fuel alcohol, biodiesel or biofuel is produced or stored.
(2) The commission, its agents and employees and enforcement officers of the Mississippi Department of Transportation are hereby authorized to inspect any motor vehicle equipped with a biofuel conversion kit, or any other device capable of producing motor fuel.
SECTION 20. The following provision shall be codified as Section 27-55-715, Mississippi Code of 1972:
27-55-715. The amount received from the fees levied in this article shall be deposited by the commission in the State Treasury to the credit of the State Highway Fund.
SECTION 21. The following provision shall be codified as Section 27-55-717, Mississippi Code of 1972:
27-55-717. The commission has the power and authority to make all rules and regulations necessary for the administration and enforcement of this article and the rules and regulations, when made, shall have the same binding force and effect as it incorporated into this article.
SECTION 22. The following provision shall be codified as Section 27-55-719, Mississippi Code of 1972:
27-55-719. The United States government, the State of Mississippi and all agencies, departments and political subdivisions thereof are exempt from the provisions of this article.
SECTION 23. Nothing in this act shall affect or defeat any claim, assessment, appeal, suit, right or cause of action for taxes due or accrued under the gasoline tax laws and the special fuel tax laws before the date on which this act becomes effective, whether such claims, assessments, appeals, suits or actions have been begun before the date on which this act becomes effective or are begun thereafter; and the provisions of the gasoline and special fuel tax laws are expressly continued in full force, effect and operation for the purpose of the assessment, collection and enrollment of liens for any taxes due or accrued and the execution of any warrant under such laws before the date on which this act becomes effective, and for the imposition of any penalties, forfeitures or claims for failure to comply with such laws.
SECTION 24. This act shall take effect and be in force from and after July 1, 2007.