HB553 By Representative Johnson (K) RFD Ways and Means Education Rd 1 23-APR-15

SYNOPSIS: Currently, an administrative discount is provided for a supplier or permissive supplier who timely files a return for aviation gasoline tax, gasoline tax, motor fuels (diesel) tax and motor carrier fuel tax. Also, a discount is provided for aviation gasoline tax, gasoline tax, motor fuels (diesel) tax and motor carrier fuel tax when a licensed distributor or importer timely pays tax due to supplier or permissive supplier. An administrative discount is applied to aviation gas tax, gasoline tax, motor fuels (diesel) tax and motor carrier fuel taxes when a supplier or permissive supplier timely files return for payments not previously remitted.

Currently, authorized sales tax licensees are also provided a discount. An administrative discount is given on contractors’ gross receipts to contractors that file returns timely each month. A discount is applied to timely filers for use tax. Qualified wholesalers and jobbers are allowed a discount on the sale of tobacco stamps. Currently, a timely filing discount on lodgings tax is allowed for qualifying vendors.

This bill would discontinue the aforementioned discounts.

A BILL TO BE ENTITLED AN ACT

To amend Sections 40-17-340, 40-17-341, 40-17-343, 40-23-36, 40-23-77, 40-25-5, and 40-26-21, Code of Alabama 1975 to discontinue all discounts applicable to aviation gasoline tax, gasoline tax, motor fuels (diesel) tax and motor carrier fuel tax; to discontinue the discount applicable to sales tax; to discontinue the discount applicable to contractors’ gross receipts; to discontinue the discount applicable to use tax; to discontinue the discount on the sale of tobacco stamps; and to discontinue the discount applicable to lodgings tax.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:Section 1. Sections 40-17-340, 40-17-341, 40-17-343, 40-23-36, 40-23-77, 40-25-5, and 40-26-21, Code of Alabama 1975 are amended to read as follows:

§40-17-340.

"(a) Each supplier, importer, blender, permissive supplier, and exporter shall file the monthly return required herein, in a format prescribed by the commissioner, on or before the 22nd day of each calendar month for the preceding month.

"(b) Other than importers, the tax levied by this article shall be paid to the department by each taxpayer on or before the 22nd day of each calendar month for the preceding month and shall be accompanied by any required returns. The department may require all or certain taxpayers to file tax returns and payments electronically.

"(c) Importers importing motor fuel from a bulk plant or some other non-terminal storage location shall pay the tax levied by this article to the department on or before the 3rd business day following the day of importation, and the payment shall be accompanied by any required returns. The department may require all or certain taxpayers to file tax returns and payments electronically.

"(d) Importers importing motor fuel acquired at an out-of-state terminal from a supplier who has not precollected the tax imposed under Section 40-17-325 at the time of such removal shall pay the tax so levied to the department on or before the 3rd business day following the day of importation, and the payment shall be accompanied by any required returns.

"(e) A supplier or permissive supplier who timely files a return with the payment due may deduct from the amount of tax payable with the return an administrative discount of one half of one percent (.005) of the amount of tax payable to the state. Beginning October 1, 2015 and each fiscal year thereafter, a supplier or permissive supplier who timely files a return with payment shall no longer deduct from the amount of tax payable with the return the administrative discount as herein provided.

§40-17-341.

"(a) Each distributor or importer shall remit to the supplier or permissive supplier, as applicable, the motor fuel tax levied by Section 40-17-325 due on motor fuel removed at a terminal rack. At the election of a licensed distributor or licensed importer, the supplier or permissive supplier may not require the licensed distributor or licensed importer to pay the tax levied by Section 40-17-325 earlier than one business day before the date the supplier or permissive supplier is required to pay the tax to this state. An election under this subsection is subject to the condition that remittances by the licensed distributor or licensed importer of all tax due to the supplier or permissive supplier shall be paid by electronic funds transfer. An election under this subsection may be terminated by the supplier or permissive supplier if the licensed distributor or licensed importer does not make timely payments to the supplier or permissive supplier as required by this subsection.

"(b) A licensed exporter shall remit destination state tax due on motor fuel removed at a terminal rack to the supplier of the motor fuel. If the laws of the destination state prohibit the collection of the destination state's tax, the tax levied by Section 40-17-325 shall be collected.

"(c) All tax payments received by a supplier or permissive supplier shall be held in trust by the supplier or permissive supplier until the supplier or permissive supplier remits the tax payment to this state or to another state, and the supplier or permissive supplier shall constitute the trustee for the tax payments.

"(d) A licensed distributor or importer that timely pays the tax due a supplier or permissive supplier as required in this section, may deduct from the amount otherwise due to the supplier or permissive supplier a discount of four tenths of one percent (.004) of the amount of tax payable. The discount covers the expense of furnishing a bond and losses due to shrinkage and evaporation. A supplier or permissive supplier may not directly or indirectly deny the discount to a licensed distributor or licensed importer that timely pays the tax due the supplier or permissive supplier as required by this section. Beginning October 1, 2015 and each fiscal year thereafter, a licensed distributor or importer that timely pays the tax due a supplier or permissive supplier as required in this section, shall no longer deduct from the amount otherwise due to the supplier or permissive supplier a discount as herein provided.

§40-17-343.

"(a) The supplier or permissive supplier may deduct from the next monthly return those tax payments that were not remitted for the previous month to the supplier or permissive supplier by any licensed distributor or any licensed importer who removed motor fuel on which the tax is due from the supplier's or permissive supplier's terminal. The licensed supplier or permissive supplier is eligible to take this deduction if the licensed supplier or permissive supplier notifies the state within 20 business days after a return is due of any licensed distributor, importer, or exporter who did not pay to the supplier or permissive supplier the tax due this state by the time the supplier or permissive supplier filed the monthly return and if, when a licensed distributor or licensed importer fails to remit the tax to the licensed supplier or permissive supplier, the licensed supplier or permissive supplier is not eligible to take the deduction for any tax payments that accrue after the 20 business day period referenced above for delinquent distributors or importers. The notice shall be transmitted to the state in the form required by the department. If a licensee later pays to a supplier or permissive supplier the tax owed, but the payment occurs after the supplier or permissive supplier has deducted the amount of the tax on a return, the supplier or permissive supplier shall remit the payment to the department with the next monthly return filed subsequent to receipt of the tax.

"(b) A supplier or permissive supplier who timely files a return with the payment due may deduct, from the amount of tax payable with the return, an administrative discount of one tenth of one percent of the amount of tax payable to this state, not to exceed two thousand dollars ($2,000) per month. Beginning October 1, 2015 and each fiscal year thereafter, a supplier or permissive supplier who timely files a return with the payment due shall no longer deduct, from the amount of tax payable with the return, an administrative discount as herein provided.

§40-23-36.

"(a) The Governor may, by executive order, authorize the Department of Revenue to provide by proper rules and regulations for the allowance of a discount, not to exceed five percent of the first $100 of taxes levied and two percent of the taxes levied over $100 by this division and due and payable to the state by any person licensed under the provisions hereof; provided, that no discount shall be authorized or allowed upon any taxes which are not paid before delinquency, as in this division provided. Beginning on October 1, 2015 and each fiscal year thereafter, any person licensed under the provisions hereof shall no longer be allowed a discount as herein provided and as provided by executive order.

"(b) For any taxes collected by the license holder on or after June 1, 1996, the Governor may, by executive order, authorize the Department of Revenue to provide by proper rules and regulations for a maximum discount amount or rate to any license holder and shall be limited to that amount or rate for each retail license holder regardless of the number of retail locations of that license holder within the state.

§40-23-77.

"A discount of three percent of the taxes levied by this article due and payable to the state shall be allowed to the seller or vendor; provided, that the taxes due by such seller are paid before same becomes delinquent, as in this article provided. Beginning October 1, 2015 and each fiscal year thereafter, the seller or vendor shall no longer be allowed a discount of taxes levied by this article.

"Effective June 1, 2001, the Governor may, by executive order, authorize the Department of Revenue to provide by proper rules and regulations for the allowance of a discount, not to exceed three percent (3%) of the taxes levied by this article due and payable to the state by the seller or vendor; provided that the taxes due by such seller are paid before same becomes delinquent, as in this article provided.

"For any taxes collected by the seller or vendor on or after June 1, 2001, the Governor may, by executive order, authorize the Department of Revenue to provide by proper rules and regulations for a maximum discount amount or rate for each seller or vendor regardless of the number of locations of that seller or vendor within the state.

"Beginning June 1, 2001, until September 30, 2002, the balance of the sum equal to the increase in receipts due to any maximum discount amount or rate as provided herein shall first be credited to the Department of Conservation and Natural Resources for (1) the sum equal to the interest the Game and Fish Fund and the Seafood Fund would have earned on the sale of hunting and/or fishing licenses, which is required to be credited to the funds by Federal Regulation 50 CFR 80.4a(3), and (2) a sum equal to one million dollars ($1,000,000) for the Coastal Programs; and any remaining balance shall be credited to the State General Fund.

"Beginning October 1, 2002, and each fiscal year thereafter the lesser of five hundred thousand dollars ($500,000) or the entire amount of the sum equal to the increase in receipts due to any maximum discount amount or rate as provided herein shall be credited to the Department of Human Resources and expended for the foster children program. Any remaining balance shall first be credited to the Department of Conservation and Natural Resources to be allocated in whole or in part to the following: (1) To the Game and Fish Fund and the Seafood Fund in an amount at least equal to the interest that each fund would have earned on the sale of hunting and/or fishing licenses which is required to be credited to the funds by the Federal Regulation 50 CFR 80.4a(3), and (2) to the Coastal Programs, a sum equal to one million dollars ($1,000,000); and any remaining balance shall be credited to the State General Fund. Notwithstanding the foregoing, for the fiscal years ending September 30, 2012, and September 30, 2013, only, the one million dollars ($1,000,000) that would otherwise be distributed to the Coastal Programs shall instead be distributed to the State General Fund. Beginning October 1, 2015 and each fiscal year thereafter, all proper rules and regulations and distribution of the discount of taxes levied in this article and by executive order shall no longer apply.

§40-25-5.

"The Department of Revenue is hereby authorized and directed to have prepared and distributed stamps suitable for denoting the tax on all articles enumerated herein. Any person, firm, corporation, or association of persons, other than the Department of Revenue, who sells tobacco tax stamps not affixed to tobacco sold and delivered by them, whether the said stamps be genuine or counterfeit, shall be guilty of a felony and punishable as set out in Section 40-25-6. When wholesalers or jobbers have qualified as such with the Department of Revenue, as provided in Section 40-25-16, and desire to purchase stamps as prescribed herein for use on taxable tobaccos sold and delivered by them, the Department of Revenue shall allow on such sales of tobacco tax stamps a discount of seven and one-half percent on the entire amount of the sale. Where wholesalers or jobbers are entitled to purchase stamps at a discount as herein provided, instead of the Department of Revenue selling such stamps to such jobbers or wholesalers for cash, it may consign such stamps, if and when such wholesaler or jobber shall give to the Department of Revenue a good and sufficient bond executed by some surety company authorized to do business in this state, conditioned to secure the payment for the stamps so consigned when and as they are used on manufactured tobacco products by such wholesaler or jobber. Every wholesaler or jobber purchasing stamps on consignment as described herein, shall be required to make a full and complete accounting and remittance on or before the twentieth of each month for all stamps used on taxable tobaccos during the preceding month. Every wholesaler or jobber refusing or failing to comply with this section shall forfeit the commission or discount on stamps used which he failed or refused to account or remit for in the time allowed, and in addition shall be charged interest on such delinquent amount for each day delinquent at the rate of eight percent per annum. Beginning October 1, 2015 and each fiscal year thereafter, wholesalers or jobbers shall no longer be entitled to purchase stamps at a discount as herein provided.

§40-26-21.

"The Governor may, by executive order, authorize the state Department of Revenue to provide by proper rules and regulations for the allowance of a discount of taxes due and payable to the state by persons subject to the lodgings tax levied by this chapter, in the same manner and to the same extent as the discount allowed persons licensed under the provisions of Division 1 of Article 1 of Chapter 23 of this title. The discount provided for herein shall not exceed five percent of the first $100 of taxes levied and two percent of the taxes levied over $100 and due and payable to the state by persons subject to this chapter. It is provided, however, that the discount provided for herein shall be authorized or allowed only upon taxes which are paid before delinquency. Beginning October 1, 2015 and each fiscal year thereafter, persons subject to the lodgings tax levied by this chapter shall no longer be allowed a discount of taxes due and payable to the state as herein provided."