HB-6031, As Passed Senate, September 19, 2006

SENATE SUBSTITUTE FOR

HOUSE BILL NO. 6031

     A bill to amend 1980 PA 119, entitled

"Motor carrier fuel tax act,"

by amending section 8 (MCL 207.218), as amended by 2004 PA 472.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 8. (1) Every qualified commercial motor vehicle leased to

a motor carrier shall be subject to this act, to the same extent

and in the same manner as qualified commercial motor vehicles owned

by a motor carrier.

     (2) A lessor of qualified commercial motor vehicles may be

considered a motor carrier with respect to qualified commercial

motor vehicles leased to others, if the lessor supplies or pays for

the motor fuel consumed by the vehicles or bills rental or other

charges calculated to include the cost of motor fuel. A lessee

motor carrier may exclude a qualified commercial motor vehicle

leased from others from the reports and liabilities required by

this act if that qualified commercial motor vehicle has been leased

from a lessor who is a motor carrier pursuant to this act and the

lease agreement provides for the lessor to pay the cost of motor

fuel and motor fuel taxes.

     (3) Upon application by the licensed motor carrier, the

department may authorize a licensed motor carrier leasing qualified

commercial motor vehicles from 2 or more lessors to file

consolidated reports for these lessors.

     (4) This section shall govern the primary liability under this

act of lessors and lessees of qualified commercial motor vehicles.

For tax liabilities incurred before April 1, 2005,  and tax

liabilities incurred after April 1, 2007, if a lessor or lessee

primarily liable fails, in whole or in part, to discharge his or

her liability, the failing party and the other lessor or lessee

party to the transaction shall be jointly and severally responsible

and liable for compliance with this act and for the payment of tax

due. However, the aggregate of taxes collected from a lessor and

lessee by this state under this act shall not exceed the total

amount of taxes due and costs and penalties imposed.

     (5) For tax liabilities arising after April 1, 2005,  and

before April 1, 2007, if a lease agreement identifies a party

responsible for the payment of taxes, the nonresponsible party

under the lease shall obtain a copy of the responsible party's

valid international fuel tax agreement registration and keep the

copy on file. If the nonresponsible party does not obtain a copy of

the responsible party's valid international fuel tax agreement

registration and the responsible party fails in whole or in part to

discharge his or her liability, then the responsible and

nonresponsible parties shall be jointly and severally responsible

and liable for compliance with this act and payment of tax due. If

the lease agreement does not identify the party responsible for

payment of fuel taxes under this act, then both parties shall be

jointly and severally responsible and liable for compliance with

this act and payment of tax due. However, the aggregate of taxes

collected from a lessor and lessee by this state under this act

shall not exceed the total amount of taxes due and costs and

penalties imposed. If the nonresponsible party under the lease

maintains a copy of the responsible party's valid international

fuel tax agreement registration on file, the nonresponsible party

shall have no responsibility or liability for compliance with this

act or payment of any taxes, costs, or penalties due under this act

relating to the motor fuel consumed under the lease.