Rep. Norm Thurston — Voting Record

Bill

Number

S.B. 24 First Substitute (2017GS)

Sponsor

Sen. Hemmert, D.

Final action

Governor Signed 3/22/2017

Outcome

Became law — signed by Gov. Gary R. Herbert

Summary

What it does

• This bill:
• clarifies that the corporate tax credit is nonrefundable;
• amends definitions;
• removes references to qualified conversions;
• modifies the definition of a "qualified heavy duty vehicle" to include heavy duty vehicles that have hydrogen-electric and electric drivetrains for purposes of receiving a corporate or individual income tax credit; and
• makes technical and conforming changes.

Every vote on this bill

Bill text

HEAVY DUTY TAX CREDIT AMENDMENTS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Daniel Hemmert
House Sponsor: 
Jon E. Stanard
LONG TITLE
General Description:
This bill amends the corporate and individual heavy duty vehicle tax credits.
Highlighted Provisions:
This bill:
▸ clarifies that the corporate tax credit is nonrefundable;
▸ amends definitions;
▸ removes references to qualified conversions;
▸ modifies the definition of a "qualified heavy duty vehicle" to include heavy duty
vehicles that have hydrogen-electric and electric drivetrains for purposes of
receiving a corporate or individual income tax credit; and
▸ makes technical and conforming changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
This bill provides retrospective operation.
Utah Code Sections Affected:
AMENDS:
59-7-618
, as last amended by Laws of Utah 2016, Chapter 375
59-10-1033
, as last amended by Laws of Utah 2016, Chapter 375
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
59-7-618
 is amended to read:
59-7-618.
Tax credit related to alternative fuel heavy duty vehicles.
(1) As used in this section:
(a) "Board" means the Air Quality Board created under Title 19, Chapter 2, Air
Conservation Act.
(b) "Director" means the director of the Division of Air Quality appointed under
Section 
19-2-107
.
[
(b)
] 
(c)
 "Heavy duty vehicle" means a commercial category 7 or 8 vehicle, according
to vehicle classifications established by the Federal Highway Administration.
[
(c)
] 
(d)
 "Natural gas" includes compressed natural gas and liquified natural gas.
[
(d)
] 
(e)
 "Qualified heavy duty vehicle" means a heavy duty vehicle that:
(i) has never been titled or registered and has been driven less than 7,500 miles; and
(ii) is fueled by natural gas 
, has a 100% electric drivetrain, or has a hydrogen-electric
drivetrain
 .
[
(e)
] 
(f)
 "Qualified purchase" means the purchase of a qualified heavy duty vehicle.
[
(f)
] 
(g)
 "Qualified taxpayer" means a taxpayer [
who
] 
that
:
(i) purchases a qualified heavy duty vehicle; and
(ii) receives a tax credit certificate from the [
board
] 
director
.
[
(g)
] 
(h)
 "Small fleet" means 40 or fewer heavy duty vehicles registered in the state and
owned by a single taxpayer.
[
(h)
] 
(i)
 "Tax credit certificate" means a certificate issued by the [
board
] 
director
certifying that a taxpayer is entitled to a tax credit as provided in this section and stating the
amount of the tax credit.
(2) [
For a taxable year beginning on or after January 1, 2015, a
] 
A
 qualified taxpayer
may claim a 
nonrefundable
 tax credit against tax otherwise due under this chapter or Chapter 8,
Gross Receipts Tax on Certain Corporations Not Required to Pay Corporate Franchise or
Income Tax Act:
(a) in an amount equal to:
[
(i) $25,000, if the qualified purchase occurs during calendar year 2015, calendar year
2016, or calendar year 2017;
]
(i) $25,000, if the qualified purchase of a natural gas heavy duty vehicle occurs during
calendar year 2015 or calendar year 2016;
(ii) $25,000, if the qualified purchase occurs during calendar year 2017;
[
(ii)
] 
(iii)
 $20,000, if the qualified purchase occurs during calendar year 2018;
[
(iii)
] 
(iv)
 $18,000, if the qualified purchase occurs during calendar year 2019; and
[
(iv)
] 
(v)
 $15,000, if the qualified purchase occurs during calendar year 2020; and
(b) if the 
qualified
 taxpayer certifies under oath that over 50% of the miles that the
heavy duty vehicle that is the subject of the qualified purchase will travel annually will be
within the state.
(3) (a) Except as provided in Subsection (3)(b), a taxpayer may not submit an
application for, and the [
board
] 
director
 may not issue to the taxpayer, a tax credit certificate
under this section in any taxable year for a [
qualifying
] 
qualified
 purchase if the [
board
]
director
 has already issued tax credit certificates to the taxpayer for 10 [
qualifying
] 
qualified
purchases in the same taxable year.
(b) If, by May 1 of any year, more than 30% of the aggregate annual total amount of
tax credits under Subsection (5) has not been claimed, a taxpayer may submit an application
for, and the [
board
] 
director
 may issue to the taxpayer, one or more tax credit certificates for up
to eight additional [
qualifying
] 
qualified
 purchases, even if the [
board
] 
director
 has already
issued to that taxpayer tax credit certificates for the maximum number of [
qualifying
] 
qualified
purchases allowed under Subsection (3)(a).
(4) (a) Subject to Subsection (4)(b), the [
board
] 
director
 shall reserve 25% of all tax
credits available under this section for 
qualified
 taxpayers with a small fleet.
(b) Subsection (4)(a) does not prevent a taxpayer from submitting an application for, or
the [
board
] 
director
 from issuing, a tax credit certificate if [
the
]
, before October 1, qualified
taxpayers with a small fleet have not reserved under Subsection (5)(b) tax credits for the full
amount reserved under Subsection (4)(a) [
for taxpayers with a small fleet has not been claimed
by a date that is 90 days before the end of the year
].
(5) (a) The aggregate annual total amount of tax credits represented by tax credit
certificates that the [
board
] 
director
 issues under this section[
, when combined with the
aggregate annual total amount of tax credits represented by tax credit certificates that the board
issues under
] 
and
 Section 
59-10-1033
[
,
] may not exceed $500,000.
(b) The board shall, in accordance with Title 63G, Chapter 3, Utah Administrative
Rulemaking Act, make rules to establish a process [
whereby
] 
under which
 a taxpayer may
reserve a potential tax credit under this section for a limited time to allow the taxpayer to make
a [
qualifying
] 
qualified
 purchase with the assurance that the aggregate limit under Subsection
(5)(a) will not be met before the taxpayer is able to submit an application for a tax credit
certificate.
(6) (a) (i) A taxpayer wishing to claim a tax credit under this section shall, using forms
the board requires by rule:
(A) submit to the [
board
] 
director
 an application for a tax credit;
(B) provide the [
board
] 
director
 proof of a [
qualifying
] 
qualified
 purchase; and
(C) submit to the [
board
] 
director
 the certification under oath required under
Subsection (2)(b).
(ii) Upon receiving the application, proof, and certification required under Subsection
(6)(a)(i), the [
board
] 
director
 shall provide the taxpayer a written statement from the [
board
]
director
 acknowledging receipt of the proof.
(b) If the [
board
] 
director
 determines that a taxpayer qualifies for a tax credit under this
section, the [
board
] 
director
 shall:
(i) determine the amount of tax credit the taxpayer is allowed under this section; and
(ii) provide the [
qualifying
] taxpayer with a written tax credit certificate:
(A) stating that the taxpayer has qualified for a tax credit; and
(B) showing the amount of tax credit for which the taxpayer has qualified under this
section.
(c) A 
qualified
 taxpayer shall retain the tax credit certificate.
(d) The [
board
] 
director
 shall at least annually submit to the commission a list of all
qualified
 taxpayers to [
whom the board
] 
which the director
 has issued a tax credit certificate
and the amount of each tax credit represented by the tax credit certificates.
(7) The tax credit under this section is allowed only:
(a) against a tax owed under this chapter or Chapter 8, Gross Receipts Tax on Certain
Corporations Not Required to Pay Corporate Franchise or Income Tax Act, in the taxable year
by the qualified taxpayer;
(b) for the taxable year in which the [
qualifying
] 
qualified
 purchase occurs; and
(c) once per vehicle.
(8) A [
qualifying
] 
qualified
 taxpayer may not assign a tax credit or a tax credit
certificate under this section to another person.
(9) If the [
amount of
] 
qualified taxpayer receives
 a tax credit [
claimed by a qualifying
taxpayer
] 
certificate
 under this section 
that allows a tax credit in an amount that
 exceeds the
[
qualifying
] 
qualified
 taxpayer's tax liability under this chapter or Chapter 8, Gross Receipts
Tax on Certain Corporations Not Required to Pay Corporate Franchise or Income Tax Act, for
a taxable year, the 
qualified taxpayer may carry forward the
 amount of the tax credit
[
exceeding
] 
that exceeds
 the tax liability [
may be carried forward
] for a period that does not
exceed the next five taxable years.
(10) (a) In accordance with any rules prescribed by the commission under Subsection
(10)(b), the Division of Finance shall transfer at least annually from the General Fund into the
Education Fund the aggregate amount of all tax credits claimed under this section.
(b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
commission may make rules for making a transfer from the General Fund into the Education
Fund as required by Subsection (10)(a).
Section 2. Section 
59-10-1033
 is amended to read:
59-10-1033.
Tax credit related to alternative fuel heavy duty vehicles.
(1) As used in this section:
(a) "Board" means the Air Quality Board created under Title 19, Chapter 2, Air
Conservation Act.
(b) "Director" means the director of the Division of Air Quality appointed under
Section 
19-2-107
.
[
(b)
] 
(c)
 "Heavy duty vehicle" means a commercial category 7 or 8 vehicle, according
to vehicle classifications established by the Federal Highway Administration.
[
(c)
] 
(d)
 "Natural gas" includes compressed natural gas and liquified natural gas.
[
(d)
] 
(e)
 "Qualified heavy duty vehicle" means a heavy duty vehicle that:
(i) has never been titled or registered and has been driven less than 7,500 miles; 
and
(ii) is fueled by natural gas[
; and
] 
, has a 100% electric drivetrain, or has a
hydrogen-electric drivetrain.
[
(iii) meets air quality standards.
]
[
(e)
] 
(f)
 "Qualified purchase" means the purchase of a qualified heavy duty vehicle.
[
(f)
] 
(g)
 "Qualified taxpayer" means a claimant, estate, or trust that:
(i) purchases a qualified heavy duty vehicle; and
(ii) receives a tax credit certificate from the [
board
] 
director
.
[
(g)
] 
(h)
 "Small fleet" means 40 or fewer heavy duty vehicles registered in the state and
owned by a single claimant, estate, or trust.
[
(h)
] 
(i)
 "Tax credit certificate" means a certificate issued by the [
board
] 
director
certifying that a claimant, estate, or trust is entitled to a tax credit as provided in this section
and stating the amount of the tax credit.
(2) [
For a taxable year beginning on or after January 1, 2015, a
] 
A
 qualified taxpayer
may claim a nonrefundable tax credit against tax otherwise due under this chapter:
(a) in an amount equal to:
[
(i) $25,000, if the qualified purchase occurs during calendar year 2015, calendar year
2016, or calendar year 2017;
]
(i) $25,000, if the qualified purchase of a natural gas heavy duty vehicle occurs during
calendar year 2015 or calendar year 2016;
(ii) $25,000, if the qualified purchase occurs during calendar year 2017;
[
(ii)
] 
(iii)
 $20,000, if the qualified purchase occurs during calendar year 2018;
[
(iii)
] 
(iv)
 $18,000, if the qualified purchase occurs during calendar year 2019; and
[
(iv)
] 
(v)
 $15,000, if the qualified purchase occurs during calendar year 2020; and
(b) if the [
claimant, estate, or trust
] 
qualified taxpayer
 certifies under oath that over
50% of the miles that the heavy duty vehicle that is the subject of the qualified purchase [
or
qualified conversion
] will travel annually will be within the state.
(3) (a) Except as provided in Subsection (3)(b), a claimant, estate, or trust may not
submit an application for, and the [
board
] 
director
 may not issue to the claimant, estate, or
trust, a tax credit certificate under this section in any taxable year for a [
qualifying
] 
qualified
purchase if the [
board
] 
director
 has already issued 
tax credit certificates
 to the claimant, estate,
or trust 
for
[
tax credits for qualifying
] 
qualified
 purchases in the same taxable year.
(b) If, by May 1 of any year, more than 30% of the aggregate annual total amount of
tax credits under Subsection (5) has not been claimed, a claimant, estate, or trust may submit
an application for, and the [
board
] 
director
 may issue to the claimant, estate, or trust, one or
more tax credit certificates for up to eight additional [
qualifying
] 
qualified
 purchases, even if
the [
board
] 
director
 has already issued to that claimant, estate, or trust tax credit certificates for
the maximum number of [
qualifying
] 
qualified
 purchases allowed under Subsection (3)(a).
(4) (a) Subject to Subsection (4)(b), the [
board
] 
director
 shall reserve 25% of all tax
credits available under this section for [
claimants, estates, or trusts
] 
qualified taxpayers
 with a
small fleet.
(b) Subsection (4)(a) does not prevent a claimant, estate, or trust from submitting an
application for, or the [
board
] 
director
 from issuing, a tax credit certificate if [
the
]
, before
October 1, qualified taxpayers with a small fleet have not reserved under Subsection (5)(b) tax
credits for the full
 amount reserved under Subsection (4)(a) [
for claimants, estates, or trusts
with a small fleet has not been claimed by a date that is 90 days before the end of the year
].
(5) (a) The aggregate annual total amount of tax credits represented by tax credit
certificates that the [
board
] 
director
 issues under this section[
, when combined with the
aggregate annual total amount of tax credits represented by tax credit certificates that the board
issues under
] 
and
 Section 
59-7-618
[
,
] may not exceed $500,000.
(b) The board shall, in accordance with Title 63G, Chapter 3, Utah Administrative
Rulemaking Act, make rules to establish a process [
whereby a taxpayer
] 
under which a
claimant, estate, or trust
 may reserve a potential tax credit under this section for a limited time
to allow the [
taxpayer
] 
claimant, estate, or trust
 to make a [
qualifying
] 
qualified
 purchase with
the assurance that the aggregate limit under Subsection (5)(a) will not be met before the
[
taxpayer
] 
claimant, estate, or trust
 is able to submit an application for a tax credit certificate.
(6) (a) (i) A claimant, estate, or trust wishing to claim a tax credit under this section
shall, using forms the board requires by rule:
(A) submit to the [
board
] 
director
 an application for a tax credit;
(B) provide the [
board
] 
director
 proof of a [
qualifying
] 
qualified
 purchase [
or
qualifying conversion
]; and
(C) submit to the [
board
] 
director
 the certification under oath required under
Subsection (2)(b).
(ii) Upon receiving the application, proof, and certification required under Subsection
(6)(a)(i), the [
board
] 
director
 shall provide the claimant, estate, or trust a written statement
from the [
board
] 
director
 acknowledging receipt of the proof.
(b) If the [
board
] 
director
 determines that a claimant, estate, or trust qualifies for a tax
credit under this section, the [
board
] 
director
 shall:
(i) determine the amount of tax credit the claimant, estate, or trust is allowed under this
section; and
(ii) provide the [
qualifying taxpayer
] 
claimant, estate, or trust
 with a written tax credit
certificate:
(A) stating that the claimant, estate, or trust has qualified for a tax credit; and
(B) showing the amount of tax credit for which the claimant, estate, or trust has
qualified under this section.
(c) A [
claimant, estate, or trust
] 
qualified taxpayer
 shall retain the tax credit certificate.
(d) The [
board
] 
director
 shall at least annually submit to the commission a list of all
[
claimants, estates, and trusts
] 
qualified taxpayers
 to which the [
board
] 
director
 has issued a tax
credit certificate and the amount of each tax credit represented by the tax credit certificates.
(7) The tax credit under this section is allowed only:
(a) against a tax owed under this chapter in the taxable year by the qualified taxpayer;
(b) for the taxable year in which the [
qualifying
] 
qualified
 purchase occurs; and
(c) once per vehicle.
(8) A [
qualifying
] 
qualified
 taxpayer may not assign a tax credit or a tax credit
certificate under this section to another person.
(9) If the [
amount of
] 
qualified taxpayer receives
 a tax credit [
claimed by a qualifying
taxpayer
] 
certificate
 under this section 
that allows a tax credit in an amount that
 exceeds the
[
qualifying
] 
qualified
 taxpayer's tax liability under this chapter for a taxable year, the 
qualified
taxpayer may carry forward the
 amount of the tax credit [
exceeding
] 
that exceeds
 the tax
liability [
may be carried forward
] for a period that does not exceed the next five taxable years.
(10) (a) In accordance with any rules prescribed by the commission under Subsection
(10)(b), the Division of Finance shall transfer at least annually from the General Fund into the
Education Fund the aggregate amount of all tax credits claimed under this section.
(b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
commission may make rules for making a transfer from the General Fund into the Education
Fund as required by Subsection (10)(a).
Section 3. 
Retrospective operation.
This bill has retrospective operation for a taxable year beginning on or after January 1,
2017.