Collection and remittance of special fuel tax
Sec. 35. (a) The tax on special fuel received by a licensed supplier
in Indiana that is imposed by section 28 of this chapter shall be
collected and remitted to the state by the supplier who receives
taxable gallons in accordance with subsection (b).
(b) On or before the fifteenth day of each month, licensed
suppliers and licensed permissive suppliers shall make an estimated
payment of all taxes imposed on transactions that occurred during the
previous calendar month equal to:
(1) one hundred percent (100%) of the amount remitted by the
licensed supplier or licensed permissive supplier for the month
preceding the previous calendar month; or
(2) ninety-five percent (95%) of the amount actually due and
payable by the licensed supplier or licensed permissive supplier
for the previous month.
Any remaining tax imposed on transactions occurring during a
calendar month shall be due and payable on or before the twentieth
day of the following month, except as provided in subsection (i).
Underpayments of estimated taxes due and owing the department are
not subject to a penalty under section 63(a) of this chapter.
(c) A supplier who sells special fuel shall collect from the
purchaser the special fuel tax imposed under section 28 of this
chapter. At the election of an eligible purchaser, the seller shall not
require a payment of special fuel tax from the purchaser at a time that
is earlier than the date on which the tax is required to be remitted by
the supplier under subsection (b). This election shall be subject to a
condition that the eligible purchaser's remittances of all amounts of
tax due the seller shall be paid by electronic funds transfer on or
before the due date of the remittance by the supplier to the
department, and the eligible purchaser's election under this
subsection may be terminated by the seller if the eligible purchaser
does not make timely payments to the seller as required by this
subsection.
(d) As used in this section, "eligible purchaser" means a person
who has authority from the department to make the election under
subsection (c) and includes every person who is licensed and in good
standing as a special fuel dealer or special fuel user, as determined
by the department, as of July 1, 1993, who has purchased a minimum
of two hundred forty thousand (240,000) taxable gallons of special
fuel each year in the preceding two (2) years, or who otherwise meets
the financial responsibility and bonding requirements of subsection
(e).
(e) Each purchaser that desires to make an election under
subsection (c) shall present evidence of the purchaser's eligible
purchaser status to the purchaser's seller. The department shall
determine whether the purchaser is an eligible purchaser. The
department may require a purchaser that pays the tax to a supplier to
file with the department a surety bond payable to the state, upon
which the purchaser is the obligor or other financial security, in an
amount satisfactory to the department. The department may require
that the bond indemnify the department against bad debt deductions
claimed by the supplier under subsection (g).
(f) The department shall have the authority to rescind a
purchaser's eligibility and election to defer special fuel tax
remittances upon a showing of good cause, including failure to make
timely payment under subsection (c), by sending written notice to all
suppliers and eligible purchasers. The department may require
further assurance of the purchaser's financial responsibility, or may
increase the bond requirement for that purchaser, or any other action
that the department may require to ensure remittance of the special
fuel tax.
(g) In computing the amount of special fuel tax due, the supplier
and permissive supplier shall be entitled to a deduction from the tax
payable the amount of tax paid by the supplier that has become
uncollectible from a purchaser. The department shall adopt rules
establishing the evidence a supplier must provide to receive the
deduction. The deduction shall be claimed on the first return
following the date of the failure of the purchaser if the payment
remains unpaid as of the filing date of that return or the deduction
shall be disallowed. The claim shall identify the defaulting purchaser
and any tax liability that remains unpaid. If a purchaser fails to make
a timely payment of the amount of tax due, the supplier's deduction
shall be limited to the amount due from the purchaser, plus any tax
that accrues from that purchaser for a period of ten (10) days
following the date of failure to pay. No additional deduction shall be
allowed until the department has authorized the purchaser to make a
new election under subsection (e). The department may require the
deduction to be reported in the same manner as prescribed in Section
166 of the Internal Revenue Code.
(h) The supplier and each reseller of special fuel is considered to
be a collection agent for this state with respect to that special fuel
tax, which shall be set out on all invoices and billings as a separate
line item.
(i) Except as provided in subsection (e), the tax imposed by
section 28 of this chapter on special fuel imported from another state
shall be paid by the licensed importer who has imported the
nonexempt special fuel not later than three (3) business days after the
earlier of:
(1) the time that the nonexempt special fuel entered into
Indiana; or
(2) the time that a valid import verification number was
assigned by the department under rules and procedures adopted
by the department.
However, if the importer and the importer's reseller have previously
entered into a tax precollection agreement as described in subsection
(j), and the agreement remains in effect, the supplier with whom the
agreement has been made shall become jointly liable with the
importer for the tax and shall remit the tax to the department on
behalf of the importer. This subsection does not apply to an importer
with respect to imports in vehicles with a capacity of not more than
five thousand four hundred (5,400) gallons.
(j) The department, a licensed importer, the reseller to a licensed
importer, and a licensed supplier or permissive supplier may jointly
enter into an agreement for the licensed supplier or permissive
supplier to precollect and remit the tax imposed by this chapter with
respect to special fuel imported from a terminal outside of Indiana in
the same manner and at the same time as the tax would arise and be
paid under this chapter if the special fuel had been received by the
licensed supplier or permissive supplier at a terminal in Indiana. If
the supplier is also the importer, the agreement shall be entered into
between the supplier and the department. However, any licensed
supplier or permissive supplier may make an election with the
department to treat all out-of-state terminal removals with an Indiana
destination as shown on the terminal-issued shipping paper as if the
removals were received by the supplier in Indiana pursuant to section
28 of this chapter and subsection (a), for all purposes. In this case,
the election and notice of the election to a supplier's customers shall
operate instead of a three (3) party precollection agreement. The
department may impose requirements reasonably necessary for the
enforcement of this subsection.
(k) Each licensed importer who is liable for the tax imposed by
this chapter on nonexempt special fuel imported by a fuel transport
truck having less than five thousand four hundred (5,400) gallons
capacity, for which tax has not previously been paid to a supplier,
shall remit the special fuel tax for the preceding month's import
activities with the importer's monthly report of activities. A licensed
importer shall be allowed to retain two-thirds (2/3) of the collection
allowance provided for in section 37(a) of this chapter for the tax
timely remitted by the importer directly to the state, subject to the
same pass through provided for in section 37(a) of this chapter.
(l) A licensed importer shall be allowed to retain two-thirds (2/3)
of the amount allowed in section 37(a) of this chapter of the tax
timely remitted by the licensed importer directly to the state, subject
to the same pass through provided for in section 37(a) of this chapter.
As added by P.L.277-1993(ss), SEC.44. Amended by P.L.18-1994,
SEC.27; P.L.61-1996, SEC.2; P.L.65-1997, SEC.1.
Last modified: May 28, 2006