incorporated town, township, school district, vocational school
district and county institution district.
"Registered distributor." A distributor that holds a valid
liquid fuels or fuels tax permit issued by the department.
* * *
"Tax-free motor fuels." Motor fuels upon which the oil
company franchise tax has not been imposed.
"Volunteer service." A volunteer fire company, volunteer
ambulance service or volunteer rescue squad.
Section 2. Title 75 is amended by adding a section to read:
ยง 9004.1. Exempt entity use, sale and delivery of tax-free
motor fuels.
(a) Limitations.--An exempt entity:
(1) May not be a distributor.
(2) May use tax-free motor fuels only for its own
official business purposes.
(3) May not sell or deliver tax-free motor fuels to any
other person or exempt entity except to political
subdivisions as provided under subsection (c).
(4) May purchase and take delivery of tax-free motor
fuels only from a registered distributor except for volunteer
services as provided under subsection (c).
(5) Shall cooperate with the department during an
investigation or audit related to the use, sale or delivery
of tax-free motor fuels provided for in this chapter.
(b) Penalties.--An exempt entity that improperly uses, sells
or delivers tax-free motor fuels shall:
(1) Pay to the Commonwealth the tax imposed by section
9004(b) (relating to imposition of tax, exemptions and
deductions).
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