HOUSE CONCURRENT RESOLUTION NO. 48

(By Delegates Stalnaker, H. White, Williams, Warner,

Browning, Cann, Michael and Kominar)

[Introduced February 22, 2002; referred to the

Committee on Rules.]

Requesting the Joint Committee on Government and Finance to study moving the collection of motor fuel taxes to the highest point in the distribution chain, which point is commonly referred to as the "Rack".

Whereas, Excise taxes on motor fuels are an important source of revenue in the State Road Fund, currently contributing approximately $300,000,000.00 yearly and taxable gallons are factors in the federal formulas for highway appropriations to the states, so that any increase in state fuel tax compliance will yield increased federal funds as well. There are twenty states that have passed "Rack Tax" legislation and increased their fuel tax collection considerably without any increased tax burden on road users; and
Whereas, Studies and investigations conducted by the United States government and several states have determined that motor fuel excise tax evasion is a continuing problem. Tax evasion also impacts honest businesses facing competition from tax evaders selling below legitimate cost; collection of the fuel tax at the highest point in the distribution chain can reduce fuel tax collection points from 400 currently to about 10, resulting in decreased opportunities for fuel tax evasion; and
Whereas, Electronic funds transfer, electronic filing of tax returns and electronic cross checking of shipments into West Virginia via the Internal Revenue Service's ExStar System will be easier to implement and will parallel federal tax collection efforts; and
Whereas, Constant monitoring and continued diligence are required in making and enforcing statutory and regulatory changes so that tax administration is more effective, efficient and fair while minimizing compliance costs to the greatest extent possible; therefore, be it
Resolved by the Legislature of West Virginia:
That the Joint Committee on Government and Finance is hereby requested to study the movement of motor fuel taxation to the highest point in the distribution chain and to examine anti-evasion activities to improve enforcement and to make recommendations to
the Legislature regarding this subject; and, be it
Further Resolved, That the Joint Committee on Government and Finance report to the regular session of the Legislature, 2003, on its findings, conclusions and recommendations, together with drafts of any legislation necessary to effectuate its recommendations; and, be it
Further Resolved, That the expenses necessary to conduct this study, to prepare a report and to draft necessary legislation be paid from legislative appropriations to the Joint Committee on Government and Finance.