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H.R. 823, Airport and Airway Trust Fund Tax Reinstatement Act of 1997
FILE h823.ih
HR 823 IH
105th CONGRESS
1st Session
To amend the Internal Revenue Code of 1986 to reinstate the Airport
and Airway Trust Fund excise taxes and to suspend the 4.3-cent
general revenue portion of such taxes during the reinstatement
period.
IN THE HOUSE OF REPRESENTATIVES
February 25, 1997
Mr. HILLEARY introduced the following bill; which was referred to
the Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to reinstate the Airport
and Airway Trust Fund excise taxes and to suspend the 4.3-cent
general revenue portion of such taxes during the reinstatement
period.
Be it enacted by the Senate and House of
Representatives of the United States of America in Congress
assembled,
SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.
(a) SHORT TITLE- This Act may be cited as the `Airport and Airway
Trust Fund Tax Reinstatement Act of 1997'.
(b) AMENDMENT OF 1986 CODE- Except as otherwise expressly
provided, whenever in this Act an amendment or repeal is expressed
in terms of an amendment to, or repeal of, a section or other
provision, the reference shall be considered to be made to a
section or other provision of the Internal Revenue Code of 1986.
SEC. 2. REINSTATEMENT OF AIRPORT AND AIRWAY TRUST FUND EXCISE TAXES.
(a) FUEL TAXES-
(1) AVIATION FUEL- Subparagraph (A) of section 4091(b)(3) is
amended to read as follows:
`(A) The rate of tax specified in paragraph (1) shall be
4.3 cents per gallon--
`(i) after December 31, 1996, and before the date
which is 7 days after the date of the enactment of the
Airport and Airway Trust Fund Tax Reinstatement Act of
1997, and
`(ii) after September 30, 1997.'
(2) AVIATION GASOLINE- Subsection (d) of section 4081 is
amended by striking the paragraph (3) added by section 1609(a)
of the Small Business Job Protection Act of 1996 and by
striking paragraphs (1) and (2) and inserting the following new
paragraphs:
`(1) IN GENERAL- The rates of tax specified in clauses (i)
and (iii) of subsection (a)(2)(A) shall be 4.3 cents per gallon
after September 30, 1999.
`(2) AVIATION GASOLINE- The rate of tax specified in
subsection (a)(2)(A)(ii) shall be 4.3 cents per gallon--
`(A) after December 31, 1996, and before the date which
is 7 days after the date of the enactment of the Airport
and Airway Trust Fund Tax Reinstatement Act of 1997, and
`(B) after September 30, 1997.'
(3) NONCOMMERCIAL AVIATION- Paragraph (3) of section 4041(c)
is amended to read as follows:
`(3) TERMINATION- The rate of the taxes imposed by paragraph
(1) shall be 4.3 cents per gallon--
`(A) after December 31, 1996, and before the date which
is 7 days after the date of the enactment of the Airport
and Airway Trust Fund Tax Reinstatement Act of 1997, and
`(B) after September 30, 1997.'
(b) TICKET TAXES-
(1) PERSONS- Subsection (g) of section 4261 is amended to
read as follows:
`(g) APPLICATION OF TAXES-
`(1) IN GENERAL- The taxes imposed by this section shall
apply to--
`(A) transportation beginning during the period--
`(i) beginning on the 7th day after the date of the
enactment of the Airport and Airway Trust Fund Tax
Reinstatement Act of 1997, and
`(ii) ending on September 30, 1997, and
`(B) amounts paid during such period for transportation
beginning after such period.
`(2) REFUNDS- If, as of the date any transportation begins,
the taxes imposed by this section would not have applied to
such transportation if paid for on such date, any tax paid
under paragraph (1)(B) with respect to such transportation
shall be treated as an overpayment.'
(2) PROPERTY- Subsection (d) of section 4271 is amended to
read as follows:
`(d) APPLICATION OF TAX-
`(1) IN GENERAL- The tax imposed by subsection (a) shall
apply to--
`(A) transportation beginning during the period--
`(i) beginning on the 7th day after the date of the
enactment of the Airport and Airway Trust Fund Tax
Reinstatement Act of 1997, and
`(ii) ending on September 30, 1997, and
`(B) amounts paid during such period for transportation
beginning after such period.
`(2) REFUNDS- If, as of the date any transportation begins,
the taxes imposed by this section would not have applied to
such transportation if paid for on such date, any tax paid
under paragraph (1)(B) with respect to such transportation
shall be treated as an overpayment.'
(c) TRANSFERS TO AIRPORT AND AIRWAY TRUST FUND-
(1) IN GENERAL- Subsection (b) of section 9502 is amended to
read as follows:
`(b) TRANSFERS TO AIRPORT AND AIRWAY TRUST FUND- There are hereby
appropriated to the Airport and Airway Trust Fund amounts
equivalent to--
`(1) the taxes received in the Treasury under--
`(A) subsections (c) and (e) of section 4041 (relating to
aviation fuels),
`(B) sections 4261 and 4271 (relating to transportation
by air),
`(C) section 4081 (relating to gasoline) with respect to
aviation gasoline (to the extent that the rate of the tax
on such gasoline exceeds 4.3 cents per gallon), and
`(D) section 4091 (relating to aviation fuel) to the
extent attributable to the Airport and Airway Trust Fund
financing rate, and
`(2) the amounts determined by the Secretary of the Treasury
to be equivalent to the amounts of civil penalties collected
under section 47107(n) of title 49, United States Code.'
(2) TERMINATION OF FINANCING RATE- Paragraph (3) of section
9502(f) is amended to read as follows:
`(3) TERMINATION- Notwithstanding the preceding provisions of
this subsection, the Airport and Airway Trust Fund financing
rate shall be zero with respect to taxes imposed during any
period that the rate of the tax imposed by section 4091(b)(1)
is 4.3 cents per gallon.'
(d) FLOOR STOCKS TAXES ON AVIATION GASOLINE AND AVIATION FUEL-
(1) IMPOSITION OF TAX- In the case of any aviation liquid on
which tax was imposed under section 4081 or 4091 of the
Internal Revenue Code of 1986 before the tax effective date and
which is held on such date by any person, there is hereby
imposed a floor stocks tax of--
(A) 15 cents per gallon in the case of aviation gasoline,
and
(B) 17.5 cents per gallon in the case of aviation fuel.
(2) LIABILITY FOR TAX AND METHOD OF PAYMENT-
(A) LIABILITY FOR TAX- A person holding, on the tax
effective date, any aviation liquid to which the tax
imposed by paragraph (1) applies shall be liable for such
tax.
(B) METHOD OF PAYMENT- The tax imposed by paragraph (1)
shall be paid in such manner as the Secretary shall
prescribe.
(C) TIME FOR PAYMENT- The tax imposed by paragraph (1)
shall be paid on or before the first day of the 5th month
beginning after the tax effective date.
(3) DEFINITIONS- For purposes of this subsection--
(A) TAX EFFECTIVE DATE- The term `tax effective date'
means the date which is 7 days after the date of the
enactment of this Act.
(B) AVIATION LIQUID- The term `aviation liquid' means
aviation gasoline and aviation fuel.
(C) AVIATION GASOLINE- The term `aviation gasoline' has
the meaning given such term in section 4081 of such Code.
(D) AVIATION FUEL- The term `aviation fuel' has the
meaning given such term by section 4093 of such Code.
(E) HELD BY A PERSON- Aviation liquid shall be considered
as `held by a person' if title thereto has passed to such
person (whether or not delivery to the person has been made).
(F) SECRETARY- The term `Secretary' means the Secretary
of the Treasury or the Secretary's delegate.
(4) EXCEPTION FOR EXEMPT USES- The tax imposed by paragraph
(1) shall not apply to--
(A) aviation liquid held by any person on the tax
effective date exclusively for any use for which a credit
or refund of the entire tax imposed by section 4081 or 4091
of such Code (as the case may be) is allowable for such
liquid purchased on or after such tax effective date for
such use, or
(B) aviation fuel held by any person on the tax effective
date exclusively for any use described in section 4092(b)
of such Code.
(5) EXCEPTION FOR CERTAIN AMOUNTS OF FUEL-
(A) IN GENERAL- No tax shall be imposed by paragraph (1)
on any aviation liquid held on the tax effective date by
any person if the aggregate amount of such liquid
(determined separately for aviation gasoline and aviation
fuel) held by such person on such date does not exceed
2,000 gallons. The preceding sentence shall apply only if
such person submits to the Secretary (at the time and in
the manner required by the Secretary) such information as
the Secretary shall require for purposes of this paragraph.
(B) EXEMPT FUEL- Any liquid to which the tax imposed by
paragraph (1) does not apply by reason of paragraph (4)
shall not be taken into account under subparagraph (A).
(C) CONTROLLED GROUPS- For purposes of this paragraph--
(i) CORPORATIONS-
(I) IN GENERAL- All persons treated as a controlled group shall
be treated as 1 person.
(II) CONTROLLED GROUP- The term `controlled group' has the
meaning given such term by subsection (a) of section 1563 of such
Code; except that for such purposes, the phrase `more than 50
percent' shall be substituted for the phrase `at least 80 percent'
each place it appears in such subsection.
(ii) NONINCORPORATED PERSONS UNDER COMMON CONTROL-
Under regulations prescribed by the Secretary,
principles similar to the principles of clause (i)
shall apply to a group of persons under common control
where 1 or more of such persons is not a corporation.
(6) OTHER LAWS APPLICABLE- All provisions of law, including
penalties, applicable with respect to the taxes imposed by
section 4081 or 4091 of such Code shall, insofar as applicable
and not inconsistent with the provisions of this subsection,
apply with respect to the floor stocks taxes imposed by
paragraph (1) to the same extent as if such taxes were imposed
by such section 4081 or 4091, as the case may be.
(e) EFFECTIVE DATES-
(1) FUEL TAXES- The amendments made by subsection (a) shall
apply to periods beginning on or after the 7th day after the
date of the enactment of this Act.
(2) TICKET TAXES-
(A) IN GENERAL- The amendments made by subsection (b)
shall apply to transportation beginning on or after such
7th day.
(B) EXCEPTION FOR CERTAIN PAYMENTS- Except as provided in
subparagraph (C), the amendments made by subsection (b)
shall not apply to any amount paid before such 7th day.
(C) PAYMENTS OF PROPERTY TRANSPORTATION TAX WITHIN
CONTROLLED GROUP- In the case of the tax imposed by section
4271 of the Internal Revenue Code of 1986, subparagraph (B)
shall not apply to any amount paid by 1 member of a
controlled group for transportation furnished by another
member of such group. For purposes of the preceding
sentence, all persons treated as a single employer under
subsection (a) or (b) of section 52 of the Internal Revenue
Code of 1986 shall be treated as members of a controlled
group.
(f) APPLICATION OF LOOK-BACK SAFE HARBOR FOR DEPOSITS- Nothing in
the look-back safe harbor prescribed in Treasury Regulation section
40.6302(c)-1(c)(2) shall be construed to permit such safe harbor to
be used with respect to any tax unless such tax was imposed
throughout the look-back period.
SEC. 3. REPEAL OF 4.3-CENT INCREASE IN FUEL TAX RATES ENACTED BY
THE OMNIBUS BUDGET RECONCILIATION ACT OF 1993 AND
DEDICATED TO GENERAL FUND OF THE TREASURY DURING
PERIOD TICKET TAXES IN EFFECT.
(a) IN GENERAL- Section 4081 (relating to imposition of tax on
gasoline and diesel fuel) is amended by adding at the end the
following new subsection:
`(f) REPEAL OF 4.3-CENT INCREASE IN FUEL TAX RATES ENACTED BY THE
OMNIBUS BUDGET RECONCILIATION ACT OF 1993 AND DEDICATED TO GENERAL
FUND OF THE TREASURY-
`(1) IN GENERAL- During the applicable period, each rate of
tax referred to in paragraph (2) shall be reduced by 4.3 cents
per gallon.
`(2) RATES OF TAX- The rates of tax referred to in this
paragraph are the rates of tax otherwise applicable under--
`(A) subsection (a)(2)(A) (relating to gasoline and
diesel fuel),
`(B) sections 4091(b)(3)(A) and 4092(b)(2) (relating to
aviation fuel),
`(C) section 4042(b)(2)(C) (relating to fuel used on
inland waterways),
`(D) paragraph (1) or (2) of section 4041(a) (relating to
diesel fuel and special fuels), and
`(E) section 4041(m)(1)(A)(i) (relating to certain
methanol or ethanol fuels).
`(3) COMPARABLE TREATMENT FOR COMPRESSED NATURAL GAS- No tax
shall be imposed by section 4041(a)(3) on any sale or use
during the applicable period.
`(4) COMPARABLE TREATMENT UNDER CERTAIN REFUND RULES- In the
case of fuel on which tax is imposed during the applicable
period, each of the rates specified in sections 6421(f)(2)(B),
6421(f)(3)(B)(ii), 6427(b)(2)(A), 6427(l)(3)(B)(ii), and
6427(l)(4)(B) shall be reduced by 4.3 cents per gallon.
`(5) COORDINATION WITH HIGHWAY TRUST FUND DEPOSITS- In the
case of fuel on which tax is imposed during the applicable
period, each of the rates specified in subparagraphs (A)(i) and
(C)(i) of section 9503(f)(3) shall be reduced by 4.3 cents per
gallon.
`(6) APPLICABLE PERIOD- For purposes of this subsection, the
term `applicable period' means the period after the 6th day
after the date of the enactment of this subsection and before
October 1, 1997.'
(b) EFFECTIVE DATE- The amendment made by this section shall take
effect on the date of the enactment of this Act.
SEC. 4. FLOOR STOCK REFUNDS.
(a) IN GENERAL- If--
(1) before the tax repeal date, tax has been imposed under
section 4081 or 4091 of the Internal Revenue Code of 1986 on
any liquid, and
(2) on such date such liquid is held by a dealer and has not
been used and is intended for sale,
there shall be credited or refunded (without interest) to the
person who paid such tax (hereafter in this section referred to as
the `taxpayer') an amount equal to the excess of the tax paid by
the taxpayer over the amount of such tax which would be imposed on
such liquid had the taxable event occurred on such date.
(b) TIME FOR FILING CLAIMS- No credit or refund shall be allowed
or made under this section unless--
(1) claim therefor is filed with the Secretary of the
Treasury before the date which is 6 months after the tax repeal
date, and
(2) in any case where liquid is held by a dealer (other than
the taxpayer) on the tax repeal date--
(A) the dealer submits a request for refund or credit to
the taxpayer before the date which is 3 months after the
tax repeal date, and
(B) the taxpayer has repaid or agreed to repay the amount
so claimed to such dealer or has obtained the written
consent of such dealer to the allowance of the credit or
the making of the refund.
(c) EXCEPTION FOR FUEL HELD IN RETAIL STOCKS- No credit or refund
shall be allowed under this section with respect to any liquid in
retail stocks held at the place where intended to be sold at retail.
(d) DEFINITIONS- For purposes of this section--
(1) the terms `dealer' and `held by a dealer' have the
respective meanings given to such terms by section 6412 of such
Code; except that the term `dealer' includes a producer, and
(2) the term `tax repeal date' means the 7th day after the
date of the enactment of this Act.
(e) CERTAIN RULES TO APPLY- Rules similar to the rules of
subsections (b) and (c) of section 6412 of such Code shall apply
for purposes of this section.
SEC. 5. FLOOR STOCKS TAX.
(a) IMPOSITION OF TAX- In the case of any liquid on which tax was
imposed under section 4081 or 4091 of the Internal Revenue Code of
1986 before October 1, 1997, and which is held on such date by any
person, there is hereby imposed a floor stocks tax of 4.3 cents per
gallon.
(b) LIABILITY FOR TAX AND METHOD OF PAYMENT-
(1) LIABILITY FOR TAX- A person holding a liquid on October
1, 1997, to which the tax imposed by subsection (a) applies
shall be liable for such tax.
(2) METHOD OF PAYMENT- The tax imposed by subsection (a)
shall be paid in such manner as the Secretary shall prescribe.
(3) TIME FOR PAYMENT- The tax imposed by subsection (a) shall
be paid on or before March 31, 1998.
(c) DEFINITIONS- For purposes of this section--
(1) HELD BY A PERSON- A liquid shall be considered as `held
by a person' if title thereto has passed to such person
(whether or not delivery to the person has been made).
(2) GASOLINE AND DIESEL FUEL- The terms `gasoline' and
`diesel fuel' have the respective meanings given such terms by
section 4083 of such Code.
(3) AVIATION FUEL- The term `aviation fuel' has the meaning
given such term by section 4093 of such Code.
(4) SECRETARY- The term `Secretary' means the Secretary of
the Treasury or his delegate.
(d) EXCEPTION FOR EXEMPT USES- The tax imposed by subsection (a)
shall not apply to gasoline, diesel fuel, or aviation fuel held by
any person exclusively for any use to the extent a credit or refund
of the tax imposed by section 4081 or 4091 of such Code is
allowable for such use.
(e) EXCEPTION FOR FUEL HELD IN VEHICLE TANK- No tax shall be
imposed by subsection (a) on gasoline or diesel fuel held in the
tank of a motor vehicle or motorboat.
(f) EXCEPTION FOR CERTAIN AMOUNTS OF FUEL-
(1) IN GENERAL- No tax shall be imposed by subsection (a)--
(A) on gasoline held on October 1, 1997, by any person if
the aggregate amount of gasoline held by such person on
such date does not exceed 4,000 gallons, and
(B) on diesel fuel or aviation fuel held on such date by
any person if the aggregate amount of diesel fuel or
aviation fuel held by such person on such date does not
exceed 2,000 gallons.
The preceding sentence shall apply only if such person submits
to the Secretary (at the time and in the manner required by the
Secretary) such information as the Secretary shall require for
purposes of this paragraph.
(2) EXEMPT FUEL- For purposes of paragraph (1), there shall
not be taken into account fuel held by any person which is
exempt from the tax imposed by subsection (a) by reason of
subsection (d) or (e).
(3) CONTROLLED GROUPS- For purposes of this subsection--
(A) CORPORATIONS-
(i) IN GENERAL- All persons treated as a controlled
group shall be treated as 1 person.
(ii) CONTROLLED GROUP- The term `controlled group'
has the meaning given to such term by subsection (a) of
section 1563 of such Code; except that for such
purposes the phrase `more than 50 percent' shall be
substituted for the phrase `at least 80 percent' each
place it appears in such subsection.
(B) NONINCORPORATED PERSONS UNDER COMMON CONTROL- Under
regulations prescribed by the Secretary, principles similar
to the principles of subparagraph (A) shall apply to a
group of persons under common control where 1 or more of
such persons is not a corporation.
(g) OTHER LAW APPLICABLE- All provisions of law, including
penalties, applicable with respect to the taxes imposed by section
4081 of such Code in the case of gasoline and diesel fuel and
section 4091 of such Code in the case of aviation fuel shall,
insofar as applicable and not inconsistent with the provisions of
this subsection, apply with respect to the floor stock taxes
imposed by subsection (a) to the same extent as if such taxes were
imposed by such section 4081 or 4091.
SEC. 6. BENEFITS OF TAX REPEAL SHOULD BE PASSED ON TO CONSUMERS.
(a) PASSTHROUGH TO CONSUMERS-
(1) SENSE OF CONGRESS- It is the sense of Congress that--
(A) consumers immediately receive the benefit of the
repeal of the 4.3-cent increase in the transportation motor
fuels excise tax rates enacted by the Omnibus Budget
Reconciliation Act of 1993, and
(B) transportation motor fuels producers and other
dealers take such actions as necessary to reduce
transportation motor fuels prices to reflect the repeal of
such tax increase, including immediate credits to customer
accounts representing tax refunds allowed as credits
against excise tax deposit payments under the floor stocks
refund provisions of this Act.
(2) STUDY-
(A) IN GENERAL- The Comptroller General of the United
States shall conduct a study of the repeal of the 4.3-cent
increase in the fuel tax imposed by the Omnibus Budget
Reconciliation of 1993 to determine whether there has been
a passthrough of such repeal.
(B) REPORT- Not later than July 31, 1997, the Comptroller
General of the United States shall report to the Committee
on Finance of the Senate and the Committee on Ways and
Means of the House of Representatives the results of the
study conducted under subparagraph (A).
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