| (a) Tax imposed. Every gas utility as described in
Texas Utilities Code, §122.001(1), shall report and pay a gas
utility tax as required by Texas Utilities Code, Chapter 122. The
gas utility tax is imposed on the gross income received from all activity
performed by the gas utility in Texas pursuant to Texas Utilities
Code, §121.001(a)(2). The rate of the tax is one-half of 1.0%
of the gross income subject to the tax.
(b) Tax payment. Each gas utility subject to this tax
shall report and pay the tax imposed to the Commission by February
20, May 20, August 20, and November 20 of a year for the preceding
calendar quarter. The gas utility tax report shall be of a form and
content as established by the Commission and shall be properly completed.
The Commission shall consider a gas utility tax report and payment
timely filed if it is received by Gas Services on or before the applicable
date or is sent to Gas Services by first-class United States mail
in an envelope or wrapper properly addressed and stamped and postmarked
before the deadline and received not more than 10 days later. A legible
postmark affixed by the United States Postal Service shall be prima
facie evidence of the date of mailing.
(c) Gross income and gross receipts.
(1) Gross income shall be equal to the total gross
receipts from any activity described in Texas Utilities Code, §121.001(a)(2),
other than an activity excluded by Texas Utilities Code Chapter 121
from the activities that make a person a gas utility for purposes
of that chapter, less a deduction of the costs paid to another person
by the gas utility for purchasing, treating, or storing natural gas
or for gathering or transporting natural gas to the facilities of
the gas utility. Treating shall be any process designed to make gas
of pipeline quality.
(2) Gross receipts shall be equal to the total revenue
received from the sale and/or transportation of gas. Revenue from
residential sales, commercial and industrial sales, other sales to
public authorities, sales for resale, interdepartmental sales, revenues
from transportation of gas of others, revenues from storing gas of
others, other gas revenues as they relate to natural gas sales, transportation,
and/or treating revenues related to transportation (corresponding
to Account Numbers 480, 481, 482, 483, 484, 489.1 through 489.4, and
495 of the Federal Energy Regulatory Commission (FERC) uniform system
of accounts), as well as any other applicable revenue items determined
by the Commission, shall be subject to the gas utility tax. A distribution
gas utility performing transportation for a fee (Account Number 489.3)
and/or making sales for resale (Account Number 483) shall be subject
to tax on those receipts.
(d) Nontaxable receipts. The following revenues shall
not be included in the computation of taxable gross income:
(1) revenues received from first sales of gas by a
producer thereof exclusively. If the sale by a producer of gas includes
both produced and purchased gas, then the total revenues from the
sale of produced gas shall be exempt from the gas utility tax. However,
the total revenues from the sale of purchased gas shall be subject
to the tax;
(2) revenues received from burnertip sales by a gas
utility engaged solely in retail gas distribution;
(3) revenues derived from transporting, delivering,
selling, or otherwise making available natural gas for fuel, either
directly or indirectly, to irrigation wells or from the sale, transportation,
or delivery of natural gas for any other direct use in agricultural
activities;
(4) revenues received from interstate transactions
or sales of gas which are subject to the jurisdiction of FERC under
the provisions of the Natural Gas Act, 15 United State Code §717
et seq., and the Natural Gas Policy Act, 15 United States Code §3301
et seq.; or
(5) revenues received from brokerage or off-system
sales.
(e) Deductions. To determine taxable gross income,
deductions from gross receipts for certain costs incurred are allowed.
Deductions may be used to reduce current tax liability to zero. Current
deductions may not be carried forward and deducted from gross receipts
in the next quarter. Allowable deductions shall be those costs paid
to another person associated with natural gas wellhead purchases,
natural gas field line purchases, natural gas gasoline plant outlet
purchases, natural gas city gate purchases, exchange gas, purchased
gas expenses, underground storage expenses, and the transmission and
compression of gas by others (corresponding to FERC Account Numbers
800, 801, 802, 803, 804, 806, 807, 813, and 858), and any other applicable
expenses as determined by the Commission. The balances of gas withdrawn
from storage (corresponding to FERC Account Number 808.1) (debit),
and gas delivered to storage (corresponding to FERC Account Number
808.2) (credit) shall be netted. If the net is a debit balance, that
balance shall also be deducted from the gross receipts. If the net
is a credit balance, that balance shall reduce the allowable deductions.
(f) Enforcement and penalties. Each gas utility liable
for the gas utility tax shall be subject to the enforcement and penalty
provisions set forth in Texas Utilities Code, Chapter 122. A penalty
in the amount of 5.0% of the tax due shall be imposed on any person
who fails to make a report or pay a tax as required under law. An
additional penalty of 5.0% of the tax due shall be imposed on any
person who fails to make a report or pay a tax as required before
the 30th day after the date the report or tax payment is due. If a
person fails to both make the report and pay the tax for a reporting
period, only the penalty and additional penalty, as applicable, for
failure to make the report is imposed. If the amount of a penalty
or additional penalty computed as otherwise provided by this subsection
is less than $5.00, the amount of the penalty or additional penalty
is $5.00. Any gas utility tax delinquent during the period commencing
on or after January 1, 1994, shall draw simple interest, at the rate
of 12% per year beginning on the 60th day after the date the tax becomes
delinquent until the tax is paid. The tax is considered paid when
received by the Commission in accordance with subsection (b) of this
section.
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