Michigan Laws 207.1008 – Tax on motor fuel; rates; collection or payment; exception; manner and time; imposition of rate on net gallons; legislative intent; bills of lading and invoices; identification of blended product and
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Terms Used In Michigan Laws 207.1008
- Consumer price index: means United States consumer price index for all urban consumers as defined and reported by the United States Department of Labor, Bureau of Labor Statistics. See Michigan Laws 207.1002
- Department: means the department of treasury or its designee. See Michigan Laws 207.1002
- Diesel fuel: means any liquid other than gasoline that is capable of use as a fuel or a component of a fuel in a motor vehicle that is propelled by a diesel-powered engine or in a diesel-powered train. See Michigan Laws 207.1002
- Gallon: means a unit of liquid measure as customarily used in the United States containing 231 cubic inches, or 4 quarts, or its metric equivalent expressed in liters. See Michigan Laws 207.1003
- Gasoline: means gasoline, alcohol, gasohol, casing head or natural gasoline, benzol, benzine, naphtha, and any blendstock additive, or other product including methanol that is sold for blending with gasoline or for use on the road other than products typically sold in containers of less than 5 gallons. See Michigan Laws 207.1003
- In this state: means the area within the borders of this state, including all territories within the borders owned by, held in trust by, or added to the United States of America. See Michigan Laws 207.1003
- Inflation rate: means the annual percentage change in the consumer price index, as determined by the department, comparing the 2 most recent October 1 through September 30 periods that are immediately preceding the effective date of the rate prescribed under section 8(1)(c), converted to decimals. See Michigan Laws 207.1003
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Motor fuel: means gasoline, diesel fuel, kerosene, a mixture of gasoline, diesel fuel, or kerosene, or a mixture of gasoline, diesel fuel, or kerosene and any other substance. See Michigan Laws 207.1004
- Motor vehicle: means a vehicle that is propelled by an internal combustion engine or motor and is designed to permit the vehicle's mobile use on the public roads or highways of this state. See Michigan Laws 207.1004
- Net gallons: means the remaining product, after all considerations and deductions have been made, measured in gallons, corrected to a temperature of 60 degrees Fahrenheit, 13 degrees Celsius, and a pressure of 14. See Michigan Laws 207.1004
- Position holder: means a person who has a contract with a terminal operator for the use of storage facilities and other terminal services for motor fuel at the terminal, as reflected in the records of the terminal operator. See Michigan Laws 207.1004
- Public roads or highways: means a road, street, or place maintained by this state or a political subdivision of this state and generally open to use by the public as a matter of right for the purpose of vehicular travel, notwithstanding that they may be temporarily closed or travel is restricted for the purpose of construction, maintenance, repair, or reconstruction. See Michigan Laws 207.1004
- Rack: means a mechanism for delivering motor fuel from a refinery, a terminal, or a marine vessel into a railroad tank car, a transport truck, a tank wagon, the fuel supply tank of a marine vessel, or other means of transfer outside of the bulk transfer/terminal system. See Michigan Laws 207.1005
- removed: means a physical transfer other than by evaporation, loss, or destruction of motor fuel from a terminal, manufacturing plant, customs custody, pipeline, marine vessel, or refinery that stores motor fuel. See Michigan Laws 207.1005
- state: when applied to the different parts of the United States, shall be construed to extend to and include the District of Columbia and the several territories belonging to the United States; and the words "United States" shall be construed to include the district and territories. See Michigan Laws 8.3o
- Tax: means a tax, interest, or penalty levied under this act. See Michigan Laws 207.1006
- Terminal: means a motor fuel storage and distribution facility that meets all of the following requirements:
(i) Is registered as a qualified terminal by the internal revenue service. See Michigan Laws 207.1006Terminal operator: means a person who owns, operates, or otherwise controls a terminal. See Michigan Laws 207.1006 Transmix: means the mixed product that results from the buffer or interface of 2 different products in a pipeline shipment, or a mixture of 2 different products within a refinery or terminal that results in an off-grade mixture. See Michigan Laws 207.1006
(1) Except as otherwise provided in this act and subject to the exemptions provided for in this act, tax is imposed on motor fuel imported into or sold, delivered, or used in this state at the following rates:
(a) Except as otherwise provided in subdivision (c), as follows:
(i) Through December 31, 2016, 19 cents per gallon on gasoline.
(ii) Beginning January 1, 2017, 26.3 cents per gallon on gasoline.
(b) Except as otherwise provided in subdivision (c), as follows:
(i) Through December 31, 2016, 15 cents per gallon on diesel fuel.
(ii) Beginning January 1, 2017, 26.3 cents per gallon on diesel fuel.
(c) Beginning with the rate effective on January 1, 2022 and January 1 of each year thereafter, the department shall determine a cents-per-gallon rate on motor fuel that shall be derived by multiplying the cents-per-gallon rate in effect during the immediately preceding calendar year by 1 plus the lesser of 0.05 or the inflation rate and rounding up the product to the nearest 1/10 of a cent.
(2) Tax shall not be imposed under this section on motor fuel that is in the bulk transfer/terminal system.
(3) The collection, payment, and remittance of the tax imposed by this section shall be accomplished in the manner and at the time provided for in this act.
(4) Tax is also imposed at the rate described in subsection (1) on net gallons of motor fuel, including transmix, lost or unaccounted for, at each terminal in this state. The tax shall be measured annually and shall apply to the net gallons of motor fuel lost or unaccounted for that are in excess of 1/2 of 1% of all net gallons of fuel removed from the terminal across the rack or in bulk.
(5) It is the intent of this act:
(a) To require persons who operate a motor vehicle on the public roads or highways of this state to pay for the privilege of using those roads or highways.
(b) To impose on suppliers a requirement to collect and remit the tax imposed by this act at the time of removal of motor fuel unless otherwise specifically provided in this act.
(c) To allow persons who pay the tax imposed by this act and who use the fuel for a nontaxable purpose to seek a refund or claim a deduction as provided in this act.
(d) That the tax imposed by this act be collected and paid at those times, in the manner, and by those persons specified in this act.
(6) Bills of lading and invoices shall identify the blended product and the correct fuel product code. The motor fuel tax rate for each product shall be listed separately on each invoice. Licensees shall report the correct fuel product code for the blended product as required by the department. When fuel is blended below the terminal rack, new bills of lading and invoices shall be generated and submitted to the department upon request. All bills of lading and invoices shall meet the requirements provided under this act.
(7) Notwithstanding any other provision of this act, a facility in this state that produces motor fuel and distributes the fuel from a rack for purposes of this act is a terminal, shall obtain a terminal operator license, and shall comply with all terminal operator reporting requirements under this act. A position holder in a facility shall be licensed as a supplier and shall comply with all supplier requirements under this act.
(8) Beginning with the rate in effect on January 1, 2022 and January 1 of each year thereafter, the department shall publish notice of the tax rate under this section not later than 30 days before the effective date of the rate.
(9) A determination by the department of the consumer price index, the inflation rate, or the tax rate under this section is presumed correct and shall not be set aside unless an administrative tribunal or a court of competent jurisdiction finds the department’s determination to be clearly erroneous.