|(a) Definitions. The following words and terms, when
used in this section, shall have the following meanings, unless the
context clearly indicates otherwise.
(1) Automotive oil--Any lubricating oils that can be
used in an internal combustion engine, crankcase, transmission, gear
box, or differential for an automobile, bus, or truck.
(A) Automotive oil includes natural or synthetic engine
oil, transmission fluid, and gear oil of any type that can be used,
according to the labeling, in the engine of an automobile, truck,
or bus, and includes oil that is not labeled specifically for this
use, but is suitable for this use according to generally accepted
(B) Automotive oil does not include:
(i) chain oil;
(ii) turbine oil;
(iii) waste oil;
(iv) outboard motor oil;
(v) refrigerant oil;
(vi) cotton spray oil;
(vii) form oil; and
(viii) oil additives as they exist prior to blending.
(2) Distributor--A person who maintains a distribution
center or warehouse in this state and annually sells more than 25,000
gallons of automotive oil. A distributor must obtain a permit from
the comptroller's office.
(A) The distributor's permit is valid until the permit
is surrendered by the holder or canceled by the comptroller.
(B) Oil manufacturers that meet the distributor definition,
and are currently liable for paying this fee to the comptroller, will
not be required to obtain a distributor's permit.
(3) Do-it-yourselfer used oil collection center--A
site or facility registered with the TCEQ that accepts or aggregates
and stores used oil collected only from household do-it-yourselfers.
(4) First sale--The first actual sale of automotive
oil delivered to a location in this state and sold to a purchaser
who is not an automotive oil manufacturer or distributor. A first
sale also includes the use or consumption of automotive oil in this
state. First sale does not include the sale of automotive oil:
(A) exported from this state to a location outside
this state for the purpose of sale or use outside this state;
(B) to the United States Government;
(C) for resale to or use by vessels engaged exclusively
in foreign or interstate commerce; or
(D) to a subsequent purchaser who maintains a do-it-yourselfer
used oil collection center or used oil collection center registered
by the TCEQ.
(5) Importer--Any person who imports, or causes to
be imported, automotive oil into this state for sale, use, or consumption.
(6) Oil manufacturer--Any person or entity that formulates
automotive oil and packages, distributes, or sells that automotive
oil. Oil manufacturer includes any person packaging or repackaging
(7) Out-of-state seller--A person or entity engaged
in business in this state as defined in §3.286 of this title
(relating to Seller's and Purchaser's Responsibilities, including
Nexus, Permits, Returns and Reporting Periods, and Collection and
(8) TCEQ--Texas Commission on Environmental Quality.
(9) Used oil collection center--A site or facility
that is registered by the TCEQ to manage used oil collected from used
oil generators or household do-it-yourselfers.
(1) Sales of automotive oil to an oil manufacturer
or distributor are exempt from the automotive oil fee.
(2) Sales of automotive oil to a subsequent purchaser
who maintains a do-it-yourselfer used oil collection center or used
oil collection center registered by the TCEQ are exempt from this
fee. A copy of its current TCEQ registration must be provided by the
purchaser as documentation for an exempt purchase.
(3) Sales of automotive oil to be used by vessels engaged
exclusively in foreign or interstate commerce are exempted from this
(4) Sales of automotive oil to the United States Government
are exempt from this fee.
(5) Sales of automotive oil delivered to a location
in another state for the purpose of sale or use outside the State
of Texas are exempt from this fee if shipment is made by means of:
(A) the facilities of the seller;
(B) delivery by the seller to a carrier for shipment
to a consignee at a point outside this state;
(C) delivery by the seller to a forwarding agent for
shipment to a location in another state of the United States or its
territories or possessions; or
(D) the facilities of the purchaser if proof of delivery
outside of Texas is provided.
(6) Exports beyond the territorial limits of the United
States are exempt from this fee if proof of export can be shown by:
(A) a copy of the bill of lading issued by a licensed
and certificated carrier showing the seller as consignor, the buyer
or purchaser as consignee, and a delivery point outside the territorial
limits of the United States;
(B) documentation provided by a licensed United States
custom broker certifying that delivery was made to a point outside
the territorial limits of the United States;
(C) formal entry documents from the country of destination
showing that the automotive oil was imported into a country other
than the United States. For the country of Mexico, the formal entry
document would be the pedimento de importaciones document with a computerized
number issued by Mexican customs officials;
(D) a copy of the original airway, ocean, or railroad
bill of lading issued by a licensed and certificated carrier which
describes the items being exported and a copy of the freight forwarder's
receipt if the freight forwarder takes possession of the property
in Texas; or
(E) a purchaser's blanket maquiladora exemption certificate
and a copy of the purchaser's maquiladora export permit provided to
the seller as required under §3.358 of this title (relating to
(c) Credit or refund of fee paid. A purchaser of automotive
oil who makes an exempt sale or use of the oil as provided in this
section may obtain a refund or credit from the supplier for the automotive
oil fee previously paid to the supplier. The purchaser requesting
a refund or credit from its supplier must furnish documentation that
verifies the exemption. An oil manufacturer, or distributor, or importer
who makes an exempt sale or use of the oil as provided in this section
may obtain a refund or credit from the comptroller for the automotive
oil fee previously paid to the comptroller. The amount of refund that
may be claimed may equal but not exceed the amount of the fee paid
on the automotive oil. See Tax Code, §§111.104 (Refunds);
111.1042 (Tax Refund: Informal Review); 111.105 (Tax Refund: Hearing);
111.107 (When Refund or Credit is Permitted).
(d) Report and payment required.
(1) Each automotive oil manufacturer, importer, or
distributor shall file a report with the comptroller stating the number
of quarts of automotive oil sold, imported, used, or consumed in this
(2) An automotive oil manufacturer or distributor who
makes a first sale or use of automotive oil in Texas is liable for
(3) An automotive oil importer who imports or causes
to be imported automotive oil into Texas for sale, use, or consumption
is liable for the fee at the time the oil is received by the importer.
(e) Amount of fee. The rate of fee is $.01 per quart
or $.04 per gallon of automotive oil.
(f) Due date of report and payment.
(1) The automotive oil fee report and payment are due
no later than the 25th day of the month following the end of each
calendar quarter in which the liability for the fee is incurred.
(2) An automotive oil manufacturer, importer or distributor
of automotive oil must file a quarterly report even if there is no
fee to report.
(g) Discount. A person required to pay the fee may
retain 1.0% of the amount of the fees due from each quarterly payment
as reimbursement for administrative costs.
(h) Penalty. A person who does not file a report as
provided by this section, or who possesses a fee collected or payable
under this section and does not timely remit the fee to the comptroller,
shall pay a penalty of 5.0% of the amount of the fee due and payable.
If the person does not file the report or pay the fee before the 30th
day after the day on which the fee or report is due, the person shall
pay a penalty of an additional 5.0% of the amount of the fee due and
(i) Interest. Interest accrues on the unpaid fee due
beginning 60 days after the due date and ends the day on which the
fee is paid.
|Source Note: The provisions of this §3.701 adopted to be effective June 17, 1992, 17 TexReg 4115; amended to be effective February 10, 1994, 19 TexReg 633; amended to be effective February 7, 1996, 21 TexReg 669; amended to be effective December 6, 1996, 21 TexReg 11517; amended to be effective April 13, 2005, 30 TexReg 2097; amended to be effective November 7, 2018, 43 TexReg 7361