Nebraska § 66-489 - Producer, supplier, distributor, wholesaler, or importer; motor fuel tax; excise tax; amount; when payable; exemptions; equalization fee; diesel fuel; tax, when.

§ 66-489. Producer, supplier, distributor, wholesaler, or importer; motor fuel tax; excise tax; amount; when payable; exemptions; equalization fee; diesel fuel; tax, when.

(1)(a) At the time of filing the return required by section 66-488, such producer, supplier, distributor, wholesaler, or importer shall, in addition to the tax imposed pursuant to sections 66-489.02, 66-4,140, 66-4,145, and 66-4,146 and in addition to the other taxes provided for by law, pay a tax in an amount set in subdivision (b) of this subsection upon all motor fuels as shown by such return, except that there shall be no tax on the motor fuels reported if (i) the required taxes on the motor fuels have been paid, (ii) the motor fuels have been sold to a licensed exporter exclusively for resale or use in another state, (iii) the motor fuels have been sold from a Nebraska barge line terminal, pipeline terminal, refinery, or ethanol or biodiesel facility, including motor fuels stored offsite in bulk, by a licensed producer or supplier to a licensed distributor, (iv) the motor fuels have been sold by a licensed distributor or licensed importer to a licensed distributor or to a licensed wholesaler and the seller acquired ownership of the motor fuels directly from a licensed producer or supplier at or from a refinery, barge, barge line, pipeline terminal, or ethanol or biodiesel facility, including motor fuels stored offsite in bulk, in this state or was the first importer of such fuel into this state, or (v) as otherwise provided in this section. Such producer, supplier, distributor, wholesaler, or importer shall remit such tax to the department.

(b) The tax shall be:

(i) Seven and one-half cents per gallon through December 31, 2015;

(ii) Eight cents per gallon beginning on January 1, 2016, through December 31, 2016;

(iii) Eight and one-half cents per gallon beginning on January 1, 2017, through December 31, 2017;

(iv) Nine cents per gallon beginning on January 1, 2018, through December 31, 2018; and

(v) Nine and one-half cents per gallon beginning on January 1, 2019.

(2)(a) As part of filing the return required by section 66-488, each producer of ethanol shall, in addition to other taxes imposed by the motor fuel laws, pay an excise tax of one and one-quarter cents per gallon on:

(i) Gasoline, natural gasoline, or any other gasoline component, including, but not limited to, any gasoline component produced from biomass feedstock, purchased for use as a denaturant by the producer at an ethanol facility; and

(ii) Two percent of agricultural ethyl alcohol sold that is unfit for beverage purposes and does not meet the American Society for Testing and Materials D4806 standards.

(b) All taxes, interest, and penalties collected under this subsection shall be remitted to the State Treasurer for credit to the Agricultural Alcohol Fuel Tax Fund.

(3)(a) Motor fuels, methanol, and all blending agents or fuel expanders shall be exempt from the taxes imposed by this section and sections 66-489.02, 66-4,105, 66-4,140, 66-4,145, and 66-4,146, when the fuels are used for buses equipped to carry more than seven persons for hire and engaged entirely in the transportation of passengers for hire within municipalities or within a radius of six miles thereof.

(b) The owner or agent of any bus equipped to carry more than seven persons for hire and engaged entirely in the transportation of passengers for hire within municipalities, or within a radius of six miles thereof, in lieu of the excise tax provided for in this section, shall pay an equalization fee of a sum equal to twice the amount of the registration fee applicable to such vehicle under the laws of this state. Such equalization fee shall be paid in the same manner as the registration fee and be disbursed and allocated as registration fees.

(c) Nothing in this section shall be construed as permitting motor fuels to be sold tax exempt. The department shall refund tax paid on motor fuels used in buses deemed exempt by this section.

(4) Gasoline, natural gasoline, or any other gasoline component, including, but not limited to, any gasoline component produced from biomass feedstock, purchased for use as a denaturant by a producer at an ethanol facility as defined in section 66-1333 shall be exempt from the motor fuels tax imposed by subsection (1) of this section as well as the tax imposed pursuant to sections 66-489.02, 66-4,140, 66-4,145, and 66-4,146.

(5) Unless otherwise provided by an agreement entered into between the State of Nebraska and the governing body of any federally recognized Indian tribe within the State of Nebraska, motor fuels purchased on a Nebraska Indian reservation where the purchaser is a Native American who resides on the reservation shall be exempt from the motor fuels tax imposed by this section as well as the tax imposed pursuant to sections 66-489.02, 66-4,140, 66-4,145, and 66-4,146.

(6) Motor fuels purchased for use by the United States Government or its agencies shall be exempt from the motor fuels tax imposed by this section as well as the tax imposed pursuant to sections 66-489.02, 66-4,140, 66-4,145, and 66-4,146.

(7)(a) Except as otherwise provided in subdivision (b) of this subsection, in the case of diesel fuel, there shall be no tax on the motor fuels reported if (i) the diesel fuel has been indelibly dyed and chemically marked in accordance with regulations issued by the Secretary of the Treasury of the United States under 26 U.S.C. 4082 or (ii) the diesel fuel contains a concentration of sulphur in excess of five-hundredths percent by weight or fails to meet a cetane index minimum of forty and has been indelibly dyed in accordance with regulations promulgated by the Administrator of the United States Environmental Protection Agency pursuant to 42 U.S.C. 7545.

(b) Beginning on October 1, 2026, a one-quarter of one cent tax per gallon shall be imposed on diesel fuel that (i) has been indelibly dyed and chemically marked in accordance with the regulations issued by the Secretary of the Treasury of the United States or (ii) contains a concentration of sulphur in excess of five-hundredths percent by weight or fails to meet a cetane index minimum of forty and has been indelibly dyed in accordance with the regulations promulgated by the Administrator of the United States Environmental Protection Agency.

(c) The first one hundred forty thousand dollars of taxes collected under this subsection each fiscal year shall be remitted to the State Treasurer for credit to the Motor Fuel Tax Enforcement and Collection Cash Fund, and all remaining taxes collected under this subsection each fiscal year shall be remitted to the State Treasurer for credit to the Agricultural Alcohol Fuel Tax Fund.

Question of proper method of allocation and distribution of gas tax raised. State ex rel. Heintze v. County of Adams, 162 Neb. 127, 75 N.W.2d 539 (1956).

Tax is an excise tax upon use and distribution of gasoline in the state and does not violate the commerce clause or due process and equal protection clauses of the United States Constitution. State v. Smith, 135 Neb. 423, 281 N.W. 851 (1938); Burke v. Bass, 123 Neb. 297, 242 N.W. 606 (1932).

Supreme Court refused to entertain jurisdiction of suit, under declaratory judgments act, to declare gasoline tax collected under alleged unconstitutional act a trust fund. Arlington Oil Co. v. Hall, 130 Neb. 674, 266 N.W. 583 (1936).

This section, prior to its amendment in 1937, was declared unconstitutional as a violation of section 1, Article II, and section 1, Article III, Constitution of Nebraska. Smithberger v. Banning, 130 Neb. 354, 265 N.W. 10 (1936); Smithberger v. Banning, 129 Neb. 651, 262 N.W. 492 (1935).

County is not exempt from payment of excise tax. State v. Cheyenne County, 127 Neb. 619, 256 N.W. 67 (1934).

Dry cleaner's solvents capable of use for operating motor vehicles are subject to tax. Pantorium v. McLaughlin, 116 Neb. 61, 215 N.W. 798 (1927).

Tax imposed by this section has its realistic impact upon the consumer. Standard Oil Co. v. Kurtz, 330 F.2d 178 (8th Cir. 1964).