(a) End User Number. A person who wants to use a signed
statement to purchase dyed diesel fuel tax free for use in nonhighway
equipment must apply to the comptroller for an End User Number. The
comptroller will issue to a qualified applicant an End User Number
with a prefix of DD (for non-agriculture off-highway equipment) or
AG (for agriculture off-highway equipment) depending on the manner
in which the applicant will use the dyed diesel fuel. A person cannot
use a signed statement to purchase tax-free dyed diesel fuel unless
the person holds an End User Number issued by the comptroller.
(b) Signed Statement. A person with a valid End User
Number may purchase dyed diesel fuel tax free for nonhighway use by
providing the seller with a signed statement. The signed statement
must be substantially in the form provided by the comptroller and
is subject to the limitations that are stated in paragraphs (2), (3)
and (4) of this subsection. Copies of the blank signed statements
may be obtained from the Comptroller of Public Accounts, P.O. Box
13528, Austin, Texas 78711-3528 or requested by calling (512) 463-4600,
or our toll-free number 1-800-252-1383. Taxpayers may download copies
at www.window.state.tx.us.
(1) The signed statement must include the purchaser's
End User Number, must be signed by the buyer or the buyer's authorized
representative, and must specify that:
(A) only dyed diesel fuel will be purchased using the
signed statement;
(B) all dyed diesel fuel will be used by the buyer
and will not be resold; and
(C) none of the dyed diesel fuel will be delivered
into the fuel supply tanks of motor vehicles operated on public highways.
(2) A person issued an End User Number beginning with
DD may buy, and a licensed diesel fuel supplier, permissive supplier,
or distributor may sell, dyed diesel fuel tax free using a signed
statement for not more than 10,000 gallons of dyed diesel fuel during
a calendar month regardless of whether the dyed diesel fuel is purchased
in a single transaction during that month or in multiple transactions
during that month. The purchase, sale, or delivery that causes the
10,000 gallon limit to be exceeded during a month is not taxable.
Any subsequent purchase, sale, or delivery made during the same month
is taxable.
(3) A person who has been issued an end user number
beginning with DD and who uses the dyed diesel fuel exclusively in
the original production of oil and gas, or to increase the production
of oil and gas, must obtain a letter of exception authorizing the
person to exceed the 10,000 gallon limit. Examples of uses that may
occur in the original production or to increase production of oil
and gas include the use of dyed diesel fuel to drill, fracture, perforate,
squeeze cement, acidize, log, plug back, complete, plug and abandon,
install a casing liner, pull or reset a casing liner, swab, drill
out a plug, jet, pack gravel or workover, and perform a hot oil treatment
on a formation. Oil and gas production does not include maintaining
the site, mowing, painting, gauging tanks, changing pumps, performing
rod or tubing jobs, fishing for rods or tubing, repairing a tubing
leak, changing a packer or anchor, performing hot oil or water treatment
on casing, tubing or flow lines, and transporting. A person who uses
dyed diesel fuel exclusively in the original production of oil and
gas or to increase the production of oil and gas, may buy, and a licensed
diesel fuel supplier, permissive supplier, or distributor may sell,
dyed diesel fuel tax free by using a letter of exception and a signed
statement for not more than 25,000 gallons of dyed diesel fuel during
a calendar month regardless of whether the dyed diesel fuel is purchased
in a single transaction during that month or in multiple transactions
during that month. The purchase, sale, or delivery that causes the
25,000 gallon limit to be exceeded during a calendar month is not
taxable. Any subsequent purchase, sale, or delivery made during the
same calendar month is taxable.
(4) A person who has been issued an end user number
beginning with AG and who uses dyed diesel fuel exclusively for an
agricultural purpose as described in Tax Code, §162.001, may
buy, and a diesel fuel licensed supplier, permissive supplier, or
distributor may sell, dyed diesel fuel tax free using a signed statement
for not more than 25,000 gallons of dyed diesel fuel during a calendar
month regardless of whether the dyed diesel fuel is purchased in a
single transaction during that month or in multiple transactions during
that month. The purchase, sale, or delivery that causes the 25,000
gallon limit to be exceeded during a calendar month is not taxable.
Any subsequent purchase, sale, or delivery made during the same calendar
month is taxable.
Attached Graphic
(c) A person who exceeds the limitations in subsection
(b) of this section shall be required to obtain a dyed diesel fuel
bonded user license.
(d) A separate operating division of a corporation
may apply for and receive an End User Number to buy dyed diesel fuel
tax free using a signed statement if the division:
(1) does not resell the fuel;
(2) consumes the fuel; and
(3) maintains separate storage apart from other corporate
divisions.
(e) The signed statement remains in effect until:
(1) it is revoked in writing by either the buyer or
seller;
(2) it is revoked by the comptroller upon receipt of
an electronic notification of a final judgment issued on or after
September 1, 2013, for failure to pay an amount owed to a licensed
supplier or distributor for the purchase of dyed diesel fuel and the
comptroller notifies the supplier or distributor in writing or by
means of electronic transmission that the buyer may no longer make
tax-free purchases. The comptroller may reinstate the end user number
upon receipt of an electronic notification that the judgment, including
all costs and other amounts awarded in the judgment, has been satisfied;
or
(3) the comptroller notifies the supplier or distributor
in writing or by means of electronic transmission that the buyer may
no longer make tax-free purchases.
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