HOUSE BILL No. 4872 June 4, 1997, Introduced by Rep. Harder and referred to the Committee on Appropriations. A bill to amend 1927 PA 150, entitled "An act to prescribe a privilege tax for the use of the public highways by owners and drivers of motor vehicles by imposing a specific tax upon the sale or use, within the state of Michigan, of motor fuel; to prescribe the manner and the time of paying this tax and the duties of officials and others respecting the payment and collection of this tax; to provide for the licensing of wholesale distributors, certain retail dealers, exporters, and suppliers as defined in this act; to fix a time when this tax and interest and penalties thereon become a lien upon the property of persons, firms, partnerships, associations, or corporations, subject to the payment of this tax; to provide for the enforce- ment of this lien; to permit the inspection and testing of petro- leum products; to provide for certain exemptions and refunds and for the disposition of the proceeds of this tax; and to prescribe penalties for the violation of this act," by amending section 2 (MCL 207.102), as amended by 1992 PA 225. THE PEOPLE OF THE STATE OF MICHIGAN ENACT: 1 Sec. 2. (1) A specific tax at a rate of cents per gallon 2 determined under subsection (2)or (3)is imposed on all 3 gasoline and diesel motor fuel sold or used in producing or 4 generating power for propelling motor vehicles used upon the 02761'97 TJS 2 1 public roads and highways in this state. The tax shall be paid 2 at those times, in the manner, and by those persons specified in 3 this act. It is the intent of this act to impose a tax upon the 4 owners and drivers of motor vehicles using an internal combustion 5 type of engine upon the public roads and highways of this state 6 by requiring them to pay for the privilege of using the public 7 roads and highways of this state, in addition to the motor vehi- 8 cle license tax. 9(2) Beginning January 1, 1983, and ending December 31,101984, the tax rate imposed under subsection (1) for each 12-month11period after December 31, 1982, shall be 11 cents per gallon or12the tax rate calculated by the state commissioner of revenue as13follows, with the final result of the calculation being rounded14to the nearest 1/10 of a cent, whichever is the greater:15(a) The latest available maintenance index figure for the16most recent preceding calendar year for which a maintenance index17figure is available shall be divided by the maintenance index18figure for 1980.19(b) The gallonage figure for the fiscal year ending20September 30, 1980, shall be divided by the gallonage figure for21the fiscal year preceding the 12-month period for which the tax22is being calculated.23(c) The quotient derived in subdivision (a) shall be multi-24plied by the quotient derived in subdivision (b).25(d) The product derived in subdivision (c) shall be multi-26plied by 12 cents.02761'97 3 1 (2)(3) Beginning January 1, 1985,EXCEPT AS OTHERWISE 2 PROVIDED IN THIS SUBSECTION, the tax rate imposed under 3 subsection (1)shall be the tax rate imposed for the 12-month4period ending December 31, 1984IS 15 CENTS PER GALLON. IF THE 5 FEDERAL GASOLINE TAX IS REDUCED BELOW 18.3 CENTS PER GALLON AND 6 FEDERAL FINANCIAL ALLOCATIONS TO THIS STATE FROM THE HIGHWAY 7 TRUST FUND AND FOR EXCLUSIVE PUBLIC MASS TRANSIT PURPOSES ARE 8 REDUCED OR ELIMINATED CORRESPONDINGLY, THE TAX RATE IMPOSED UNDER 9 SUBSECTION (1) SHALL BE INCREASED BY AN AMOUNT SO THAT THE COM- 10 BINED STATE AND FEDERAL TAX RATE PER GALLON EQUALS 36.3 CENTS PER 11 GALLON EFFECTIVE 15 DAYS AFTER THE DATE THE COMMISSIONER HAS MADE 12 THE NOTIFICATION REQUIRED BY SUBSECTION (3). IF THE FEDERAL TAX 13 ON DIESEL MOTOR FUEL IS REDUCED BELOW 24.3 CENTS PER GALLON AND 14 FEDERAL FINANCIAL ALLOCATIONS TO THIS STATE FROM THE HIGHWAY 15 TRUST FUND AND FOR EXCLUSIVE PUBLIC MASS TRANSIT PURPOSES ARE 16 REDUCED OR ELIMINATED CORRESPONDINGLY, THE TAX RATE IMPOSED UNDER 17 SUBSECTION (1) SHALL BE INCREASED BY AN AMOUNT SO THAT THE COM- 18 BINED STATE AND FEDERAL TAX RATE PER GALLON EQUALS 42.3 CENTS PER 19 GALLON EFFECTIVE 15 DAYS AFTER THE DATE THE COMMISSIONER HAS MADE 20 THE NOTIFICATION REQUIRED BY SUBSECTION (3). 21(4) Notwithstanding any other provision of this section, if22the United States department of transportation, federal highway23administration, materially alters the component parts of the24highway maintenance and operation index described in subsection25(8), the tax rate imposed under subsection (1) using the formula26prescribed by subsection (2) shall not change from the tax rate02761'97 4 1imposed under subsection (1) immediately preceding the2alteration.3(5) Notwithstanding any other provision of this section, the4tax rate imposed under subsection (1) for a 12-month period shall5not be more than 2 cents greater than the tax rate imposed for6the previous 12-month period.7 (3)(6)The state commissioner of revenue shall notify 8 each supplier, wholesale distributor, and each retail dealer of 9 gasoline in this state of the tax rate imposed under subsection 10 (1) immediately after the tax rate is determined. 11(7) By June 30, 1993, the department shall submit a report12to the senate finance and house taxation committees with its rec-13ommendations on the most appropriate manner in which to tax vehi-14cles propelled on the highways of this state by alternative15fuels.16(8) As used in this section:17(a) "Gallonage figure" means the number of gallons of gaso-18line, alcohol-gasoline fuel, liquefied petroleum gas, diesel19motor fuel, and any other fuel taxed under this act during a des-20ignated year.21(b) "Maintenance index figure" means the maintenance index22total for a designated year as reported in the highway mainte-23nance and operation index published annually by the United States24department of transportation, federal highway administration:25cost trends--highway maintenance and operation.02761'97 Final page. 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