HB 2544

Present law requires a person using a liquified gas propelled motor vehicle that is required to be licensed for use on public highways to prepay the liquified gas use tax to the commissioner of revenue ("commissioner"") on an annual basis. This bill, ins tead, requires that the liquified gas tax be paid on delivery of the liquified gas into the fuel supply tank of a motor vehicle. A dealer of liquified gas must collect and remit such taxes, and is liable to the state for the tax imposed. ""Liquified gas"" d oes not include gasoline, diesel fuel, compressed natural gas, or hydrogen gas. Display of Permit Present law requires a dealer who sells taxable liquified gas, or a user whose motor vehicle is licensed in this state, to file an application with the commissioner for a permit. Under present law, users are required to display such a permit in the uppe r right corner of the front windshield on the passenger side of the vehicle. This bill eliminates that display requirement. Duration of Permit Present law requires user permits to be issued annually, and such permits are valid from the date of issuance through June 30 th of each year. This bill, instead, provides that user permits are permanent and valid as long as the user reports and remits taxes when due, or until the permit is surrendered by the holder or is cancelled by the commissioner. Required Reporting Present law requires a user to submit a report by July 25 th of each year and to remit any tax due. This bill also requires permitted users to submit such a report if they did not pay the liquified gas tax to a dealer upon delivery. However, any tax paid to a dealer may be subtracted from the total amount of tax due. A user is entitled to a refund of liquified gas tax paid on each gallon of liquified gas used outside this state. The commissioner must pay such a refund if the amount is more than $10 and the user timely filed a complete report. COMPRESSED NATURAL GAS AND HYDROGEN GAS Present law imposes a tax on compressed natural gas and hydrogen gas used for the propulsion of motor vehicles on public highways in this state. This bill requires, for the purpose of determining the tax on compressed natural gas, a gallon equivalent fa ctor of 5.66 pounds per gallon be used. Further, for the purpose of determining the tax on hydrogen gas, this bill requires a gallon equivalent factor of 2.2 pounds per gallon be used. Compressed Natural Gas and Hydrogen Gas Users Present law requires a user of compressed natural gas to apply to and obtain a permit unless such natural gas is purchased from a dealer. The commissioner must issue such a permit to a person who uses compressed natural gas in a licensed motor vehicle in this state pursuant to an application. The holder of a user permit must provide written notice to the commissioner of an intent to terminate the permit. This bill imposes all of these requirements on users of hydrogen gas in a licensed motor vehicle in t his state. However, this bill clarifies that a user permit is not required for either compressed natural gas or hydrogen gas when such gas is delivered by a dealer into a customer's vehicle by means of a qualified dispenser. Compressed Natural Gas and Hydrogen Gas Dealers Present law requires a dealer of compressed natural gas to apply for a compressed natural gas dealer permit on a form provided by the commissioner. The permit must be displayed or kept for inspection at the dealer's principal place of business and each additional place of business in which natural gas is sold, delivered, or used. Present law provides that such a permit is valid as long as the dealer furnishes timely reports and remits required taxes when due. This bill imposes all of these requirement s on dealers of hydrogen gas. A natural gas or hydrogen gas dealer permit authorizes a dealer to collect and remit taxes delivered into the fuel supply tanks of motor vehicles by a qualified natural gas dispenser or a hydrogen gas dispenser with meter capa bility. Present law requires compressed natural gas dealers to file a monthly report with the commissioner, and remit the tax due and collected. This bill imposes the same requirement on hydrogen gas dealers. Present law requires a compressed natural gas deale r to keep a complete record of all metered compressed natural gas received and sold for at least four years. This bill imposes the same requirements on hydrogen gas dealers. Present law provides that meters and qualified natural gas dispensers are subject to inspection and verification by the department of agricultures weights and measures. This bill imposes the same requirement on hydrogen gas dispensers."