EXPLANATION-Matter enclosed in bold-faced brackets [thus] in this bill is not enacted
and is intended to be omitted in the law.
FIRST REGULAR SESSION
SENATE BILL NO. 774
103RD GENERAL ASSEMBLY
INTRODUCED BY SENATOR MOON.
1060S.01I KRISTINA MARTIN, Secretary
AN ACT
To repeal sections 142.815, 142.822, and 142.824, RSMo, and to enact in lieu thereof three new
sections relating to exemptions from motor fuel tax.
Be it enacted by the General Assembly of the State of Missouri, as follows:
Section A. Sections 142.815, 142.822, and 142.824, RSMo, 1
are repealed and three new sections enacted in lieu thereof, to 2
be known as sections 142.81 5, 142.822, and 142.824, to read as 3
follows:4
142.815. 1. Motor fuel used for the following 1
nonhighway purposes is exempt from the fuel tax imposed by 2
this chapter, and a refund may be claimed by the consumer, 3
except as provided for in subdivisio n (1) of this 4
subsection, if the tax has been paid and no refund has been 5
previously issued: 6
(1) Motor fuel used for nonhighway purposes including 7
fuel for farm tractors or stationary engines owned or leased 8
and operated by any person and used ex clusively for 9
agricultural purposes and including, beginning January 1, 10
2006, bulk sales of one hundred gallons or more of gasoline 11
made to farmers and delivered by the ultimate vender to a 12
farm location for agricultural purposes only. As used in 13
this section, the term "farmer" shall mean any person 14
engaged in farming in an authorized farm corporation, family 15
farm, or family farm corporation as defined in section 16
350.010. At the discretion of the ultimate vender, the 17 SB 774 2
refund may be claimed by the ultimate vender on behalf of 18
the consumer for sales made to farmers and to persons 19
engaged in construction for agricultural purposes as defined 20
in section 142.800. After December 31, 2000, the refund may 21
be claimed only by the consumer and may not be claimed by 22
the ultimate vender unless bulk sales of gasoline are made 23
to a farmer after January 1, 2006, as provided in this 24
subdivision and the farmer provides an exemption certificate 25
to the ultimate vender, in which case the ultimate vender 26
may make a claim for refund under section 142.824 but shall 27
be liable for any erroneous refund; 28
(2) Kerosene sold for use as fuel to generate power in 29
aircraft engines, whether in aircraft or for training, 30
testing or research purposes of aircraft engines ; 31
(3) Diesel fuel used as heating oil, or in railroad 32
locomotives or any other motorized flanged -wheel rail 33
equipment, or used for other nonhighway purposes other than 34
as expressly exempted pursuant to another provision. 35
2. Subject to the procedural requirements and 36
conditions set out in this chapter, the following uses are 37
exempt from the tax imposed by section 142.803 on motor 38
fuel, and a deduction or a refund may be claimed: 39
(1) (a) Motor fuel for which proof of export is 40
available in the form of a terminal -issued destination state 41
shipping paper and which is either: 42
[(a)] a. Exported by a supplier who is licensed in the 43
destination state or through the bulk transfer system; 44
[(b)] b. Removed by a licensed distributo r for 45
immediate export to a state for which all the applicable 46
taxes and fees (however nominated in that state) of the 47
destination state have been paid to the supplier, as a 48
trustee, who is licensed to remit tax to the destination 49 SB 774 3
state; or which is d estined for use within the destination 50
state by the federal government for which an exemption has 51
been made available by the destination state subject to 52
procedural rules and regulations promulgated by the 53
director; or 54
[(c)] c. Acquired by a licensed distributor and which 55
the tax imposed by this chapter has previously been paid or 56
accrued either as a result of being stored outside of the 57
bulk transfer system immediately prior to loading or as a 58
diversion across state boundaries properly report ed in 59
conformity with this chapter and was subsequently exported 60
from this state on behalf of the distributor [;]. 61
(b) The exemption pursuant to subparagraph a. of 62
paragraph (a) of this subdivision shall be claimed by a 63
deduction on the report of the supplier which is otherwise 64
responsible for remitting the tax upon removal of the 65
product from a terminal or refinery in this state. 66
(c) The [exemption] exemptions pursuant to [paragraphs 67
(b) and (c)] subparagraphs b. and c. of paragraph (a ) of 68
this subdivision shall be claimed by the distributor, upon a 69
refund application made to the director within three years. 70
(d) A refund claim may be made monthly or whenever the 71
claim exceeds one thousand dollars; 72
(2) Undyed K-1 kerosene sold at retail through 73
dispensers which have been designed and constructed to 74
prevent delivery directly from the dispenser into a vehicle 75
fuel supply tank, and undyed K -1 kerosene sold at retail 76
through nonbarricaded dispensers in quantities of not m ore 77
than twenty-one gallons for use other than for highway 78
purposes. Exempt use of undyed kerosene shall be governed 79
by rules and regulations of the director. If no rules or 80
regulations are promulgated by the director, then the exempt 81 SB 774 4
use of undyed kerosene shall be governed by rules and 82
regulations of the Internal Revenue Service. A distributor 83
or supplier delivering to a retail facility shall obtain an 84
exemption certificate from the owner or operator of such 85
facility stating that its sales con form to the dispenser 86
requirements of this subdivision. A licensed distributor, 87
having obtained such certificate, may provide a copy to his 88
or her supplier and obtain undyed kerosene without the tax 89
levied by section 142.803. Having obtained such cer tificate 90
in good faith, such supplier shall be relieved of any 91
responsibility if the fuel is later used in a taxable 92
manner. An ultimate vendor who obtained undyed kerosene 93
upon which the tax levied by section 142.803 had been paid 94
and makes sales qualifying pursuant to this subsection may 95
apply for a refund of the tax pursuant to application, as 96
provided in section 142.818, to the director provided the 97
ultimate vendor did not charge such tax to the consumer; 98
(3) Motor fuel sold to the United States or any agency 99
or instrumentality thereof. This exemption shall be claimed 100
as provided in section 142.818; 101
(4) Motor fuel used solely and exclusively as fuel to 102
propel motor vehicles on the public roads and highways of 103
this state when leased or owned and when being operated by a 104
federally recognized Indian tribe in the performance of 105
essential governmental functions, such as providing police, 106
fire, health or water services. The exemption for use 107
pursuant to this subdivision shall be m ade available to the 108
tribal government upon a refund application stating that the 109
motor fuel was purchased for the exclusive use of the tribe 110
in performing named essential governmental services; 111
(5) That portion of motor fuel used to operate 112
equipment attached to a motor vehicle, if the motor fuel was 113 SB 774 5
placed into the fuel supply tank of a motor vehicle that has 114
a common fuel reservoir for travel on a highway and for the 115
operation of equipment, or if the motor fuel was placed in a 116
separate fuel tank and used only for the operation of 117
auxiliary equipment. The exemption for use pursuant to this 118
subdivision shall be claimed by a refund claim filed by the 119
consumer who shall provide evidence of an allocation of use 120
satisfactory to the director; 121
(6) Motor fuel acquired by a consumer out -of-state and 122
carried into this state, retained within and consumed from 123
the same vehicle fuel supply tank within which it was 124
imported, except interstate motor fuel users; 125
(7) Motor fuel which was pu rchased tax-paid and which 126
was lost or destroyed as a direct result of a sudden and 127
unexpected casualty or which had been accidentally 128
contaminated so as to be unsalable as highway fuel as shown 129
by proper documentation as required by the director. The 130
exemption pursuant to this subdivision shall be refunded to 131
the person or entity owning the motor fuel at the time of 132
the contamination or loss. Such person shall notify the 133
director in writing of such event and the amount of motor 134
fuel lost or contaminated within ten days from the date of 135
discovery of such loss or contamination, and within thirty 136
days after such notice, shall file an affidavit sworn to by 137
the person having immediate custody of such motor fuel at 138
the time of the loss or contamina tion, setting forth in full 139
the circumstances and the amount of the loss or 140
contamination and such other information with respect 141
thereto as the director may require; 142
(8) Dyed diesel fuel or dyed kerosene used for an 143
exempt purpose. This exemptio n shall be claimed as follows: 144 SB 774 6
(a) A supplier or importer shall take a deduction 145
against motor fuel tax owed on their monthly report for 146
those gallons of dyed diesel fuel or dyed kerosene imported 147
or removed from a terminal or refinery destined fo r delivery 148
to a point in this state as shown on the shipping papers; 149
(b) This exemption shall be claimed by a deduction on 150
the report of the supplier which is otherwise responsible 151
for remitting the tax on removal of the product from a 152
terminal or refinery in this state; and 153
(c) This exemption shall be claimed by the 154
distributor, upon a refund application made to the director 155
within three years. A refund claim may be made monthly or 156
whenever the claim exceeds one thousand dollars; and 157
(9) Motor fuel delivered to any marina within this 158
state that sells such fuel solely for use in any watercraft, 159
as such term is defined in section 306.010, and not 160
accessible to other motor vehicles, is exempt from the fuel 161
tax imposed by this chap ter. Any motor fuel distributor 162
that delivers motor fuel to any marina in this state for use 163
solely in any watercraft, as such term is defined in section 164
306.010, may claim the exemption provided in this 165
subsection. Any motor fuel customer who purcha ses motor 166
fuel for use in any watercraft, as such term is defined in 167
section 306.010, at a location other than a marina within 168
this state may claim the exemption provided in this 169
subsection by filing a claim for refund of the fuel tax. 170
3. (1) Beginning on October 1, 2025, an entity exempt 171
from taxation as provided by Section 501(c)(3) of the 172
Internal Revenue Code of 1986 (26 U.S.C. Section 501), as 173
amended, to which an individual, person, or entity that is 174
eligible to claim a refund as provid ed in this section 175
submits all documentation and information required to make a 176 SB 774 7
refund application may make a claim for such individual's, 177
person's, or entity's refund as provided in this section. 178
Upon approval, the refund shall be made to such exempt 179
entity. 180
(2) A taxpayer who is an individual, person, or entity 181
that submits the required information to an exempt entity as 182
described in subdivision (1) of this subsection shall be 183
allowed to subtract from such taxpayer's Missouri adjusted 184
gross income to determine Missouri taxable income an amount 185
equal to the total amount eligible for a refund submitted to 186
an exempt entity under subdivision (1) of this section for 187
the same tax year. Such amount shall be deductible only to 188
the extent that such amount is not deducted on the 189
taxpayer's federal income tax return for that tax year. The 190
department of revenue shall promulgate rules and regulations 191
to administer the provisions of this section. 192
142.822. 1. (1) As used in this section and section 1
142.824, "nonprofit entity" means any entity that is exempt 2
from taxation as provided in Section 501(c)(3) of the 3
Internal Revenue Code of 1986 (26 U.S.C. Section 501), as 4
amended. 5
(2) Motor fuel used for purposes of prope lling motor 6
vehicles on highways shall be exempt from the fuel tax 7
collected under subsection 3 of section 142.803, and an 8
exemption and refund may be claimed by the taxpayer if the 9
tax has been paid and no refund has been previously issued, 10
provided that the taxpayer applies for the exemption and 11
refund as specified in this section. Beginning on and after 12
October 1, 2025, any nonprofit entity to which a taxpayer 13
who is eligible to claim a refund as provided in this 14
section submits all documentati on and information required 15
to make a refund application may make a claim for such 16 SB 774 8
taxpayer's refund as provided in this section. Upon 17
approval, the refund shall be made to such nonprofit entity. 18
2. (1) The exemption and refund shall be issued o n a 19
fiscal year basis, based on motor fuel tax paid and 20
collected through the end of fiscal year 2025, to each 21
person who pays the fuel tax collected under subsection 3 of 22
section 142.803 and who claims an exemption and refund in 23
accordance with this section, and shall apply so that the 24
fuel taxpayer has no liability for the tax collected in that 25
fiscal year under subsection 3 of section 142.803. 26
(2) Beginning in fiscal year 2026, exemptions and 27
refunds issued under this section shall be based on the tax 28
year. Any fuel taxes collected under subsection 3 of 29
section 142.803 from July 1, 2025, to December 31, 2025, 30
shall be reported under the provisions of subsection 4 of 31
this section. Any fuel taxes collected under subsection 3 32
of section 142.803 from January 1, 2026, to December 31, 33
2026, and each tax year thereafter, shall be reported under 34
the provisions of subsection 4 of this section. Exemptions 35
and refunds shall be issued to persons who pay the fuel tax 36
collected under subsection 3 of section 142.803 and who 37
claim an exemption and refund in accordance with this 38
section and shall apply so that the fuel taxpayer has no 39
liability for the tax collected in the corresponding tax 40
year under subsection 3 of section 142.803. 41
[2.] 3. To claim an exemption and refund in accordance 42
with subdivision (1) of subsection 2 of this section, a 43
person shall present to the director a statement containing 44
a written verification that the claim is made under penalty 45
of perjury and that state s the total fuel tax paid in the 46
applicable fiscal year for each vehicle for which the 47
exemption and refund is claimed. The claim shall [not be 48 SB 774 9
transferred or assigned, and shall ] be filed on or after 49
July first, but not later than September thirtieth , 50
following the fiscal year for which the exemption and refund 51
is claimed. The claim statement may be submitted 52
electronically, and shall at a minimum include the following 53
information: 54
(1) [Vehicle identification number of the motor 55
vehicle into which the motor fuel was delivered; 56
(2)] Date of sale; 57
[(3)] (2) Name and address of purchaser; 58
[(4) Name and address of seller; 59
(5)] (3) Number of gallons purchased; [and 60
(6)] (4) Number of gallons purchased and charged 61
Missouri fuel tax, as a separate item ; and 62
(5) If the claim is submitted by a nonprofit entity: 63
(a) Documentation of the nonprofit entity's tax -exempt 64
status; and 65
(b) A statement signed by the purchaser indicating 66
that the nonprofit enti ty is entitled to the purchaser's 67
refund. 68
4. To claim an exemption and refund in accordance with 69
subdivision (2) of subsection 2 of this section, a person 70
may elect to proceed under either subdivision (1) or (2) of 71
this subsection: 72
(1) For a receipt-based exemption and refund under 73
this subdivision, a person shall present to the director a 74
statement containing a written verification that the claim 75
is made under penalty of perjury and that states the total 76
fuel tax paid in the applicable tax year for each vehicle 77
for which the exemption and refund is claimed. The claim 78
shall not be transferred or assigned and shall be filed on 79
or after January fifteenth but not later than April 80 SB 774 10
fifteenth after the close of the tax year for which the 81
exemption and refund is claimed. A person claiming a refund 82
under this subdivision shall not be entitled to claim a 83
standard refund under subdivision (2) of this subsection for 84
the same tax year. The claim statement may be submitted 85
electronically and shall at a minimum include the following 86
information: 87
(a) Date of sale; 88
(b) Name and address of purchaser; 89
(c) Number of gallons purchased; 90
(d) Number of gallons purchased and charged Missouri 91
fuel tax, as a separate item; and 92
(e) An affirmation that such person is claiming the 93
itemized refund and shall not claim the standard refund 94
under subdivision (2) of this subsection; or 95
(2) For a standard refund under this subdivision, at 96
the time a person files his or her M issouri income tax 97
return, a person may select to claim the exemption and 98
refund as a standard refund applied as an immediate refund 99
or applied as a credit against the person's Missouri income 100
tax liability under chapter 143. A person claiming a 101
standard refund under this subdivision shall not be entitled 102
to claim a receipt-based refund under subdivision (1) of 103
this subsection for the same tax year. For the purposes of 104
this subdivision, the term "standard refund" shall mean the 105
exemption and refund provided under this section, applied 106
for and claimed by a person as a set, flat amount under 107
paragraph (a) of this subdivision, selected to be refunded 108
to such person as either an immediate refund or credit 109
applied against the person's Missouri inco me tax liability 110
under chapter 143. 111
(a) The standard refund shall be allocated as follows: 112 SB 774 11
a. Thirty dollars for the 2025 tax year; 113
b. Forty-five dollars for the 2026 tax year; 114
c. Sixty dollars for the 2027 tax year; 115
d. Seventy-five dollars for all tax years beginning on 116
or after January 1, 2028. 117
(b) A person shall file a form, provided by the 118
department of revenue, with such person's Missouri income 119
tax return, if applicable. The claim shall not be 120
transferred or assigned and the form shall be filed on or 121
after January fifteenth but not later than April fifteenth 122
after the close of the tax year for which the exemption and 123
refund is claimed. 124
(c) Such form may be submitted electronically and at 125
minimum shall include: 126
a. The person's selection of the standard refund taken 127
as a refund or as a credit against chapter 143 income taxes, 128
as provided under this subdivision, that he or she is 129
claiming for the applicable tax year; 130
b. An affirmation that such person is claiming the 131
standard refund and shall not claim the receipt -based refund 132
under subdivision (1) of this subsection; 133
c. The vehicle identification number of the motor 134
vehicle into which the motor fuel was delivered; 135
d. The name and address of the person making the claim; 136
e. Information or identification showing that such 137
person was the owner of a vehicle licensed in Missouri; 138
f. An affirmation that such person made eligible 139
purchases under this section in the tax y ear for which the 140
exemption and refund is claimed; and 141
g. Any other information that the department may 142
require to fulfill the obligations under this section. 143 SB 774 12
5. The exemption and refund as reimbursed under the 144
provisions of this section sha ll be paid out of the proceeds 145
of the additional tax under subsection 3 of section 146
142.803. Refunds shall not exceed the tax collected under 147
subsection 3 of section 142.803. If amount of refunds 148
claimed under this section in a tax year exceeds the ta x 149
collected for the tax year, refunds shall be allowed based 150
on the order in which they are claimed. The qualifications 151
provided under subsections 4 and 5 of this section shall be 152
subject to audit by the department . 153
[3.] 6. Every person shall ma intain and keep records 154
supporting the claim statement filed with the department of 155
revenue for a period of three years to substantiate all 156
claims for exemption and refund of the motor fuel tax, 157
together with invoices, original sales receipts marked pa id 158
by the seller, bills of lading, and other pertinent records 159
and paper as may be required by the director for reasonable 160
administration of this chapter. The requirement to maintain 161
records shall be the responsibility of any nonprofit entity 162
to which a purchaser submits claim records required by this 163
section. 164
[4.] 7. The director may make any investigation 165
necessary before issuing an exemption and refund under this 166
section, and may investigate an exemption and refund under 167
this section after it has been issued and within the time 168
frame for making adjustments to the tax pursuant to this 169
chapter. 170
[5.] 8. If an exemption and refund is not issued 171
within forty-five days of an accurate and complete filing, 172
as required by this chapter, th e director shall pay interest 173
at the rate provided in section 32.065 accruing after the 174 SB 774 13
expiration of the forty -five-day period until the date the 175
exemption and refund is issued. 176
[6.] 9. (1) Except as provided in subdivision (2) of 177
this subsection, the exemption and refund specified in this 178
section shall be available only with regard to motor fuel 179
delivered into a motor vehicle with a gross weight, as 180
defined in section 301.010, of twenty -six thousand pounds or 181
less. 182
(2) The exemption and refund specified in this 183
subsection shall be available with regard to motor fuel 184
delivered into a motor vehicle with a gross weight that 185
exceeds twenty-six thousand pounds when the motor vehicle is 186
owned by a corporation licensed in Missouri with it s primary 187
headquarters in Missouri, or owned by a sole proprietor 188
whose home office is located in Missouri, provided that the 189
corporation or sole proprietor submits documentation to the 190
director that any exemption and refund claimed is based 191
solely on fuel delivered into a motor vehicle while it was 192
operating in the state of Missouri. If the motor vehicle 193
was operated in multiple states, the applicant shall submit 194
documentation that separates the fuel delivered to the 195
vehicle while operating in ot her states from the fuel 196
delivered to the vehicle while operating in the state of 197
Missouri. 198
10. The department of revenue shall develop a mobile 199
application that allows claims to be submitted on a person's 200
phone at the time of motor fuel purchase in lieu of the 201
procedures set out under subsection 2 of this section. The 202
application shall be designed so that the person submitting 203
the claim is required to demonstrate that he or she is at 204
the motor fuel pump. The development and maintenance of t he 205 SB 774 14
application shall be paid with funds that come from the fuel 206
tax road fund. 207
[7.] 11. The director shall promulgate rules as 208
necessary to implement the provisions of this section. Any 209
rule or portion of a rule, as that term is defined in 210
section 536.010, that is created under the authority 211
delegated in this section shall become effective only if it 212
complies with and is subject to all of the provisions of 213
chapter 536 and, if applicable, section 536.028. This 214
section and chapter 536 are non severable and if any of the 215
powers vested with the general assembly pursuant to chapter 216
536 to review, to delay the effective date, or to disapprove 217
and annul a rule are subsequently held unconstitutional, 218
then the grant of rulemaking authority and any rule proposed 219
or adopted after August 28, 2021, shall be invalid and void. 220
142.824. 1. To claim a refund in accordance with 1
section 142.815, a person shall present to the director a 2
statement containing a written verification that the claim 3
is made under penalties of perjury and lists the total 4
amount of motor fuel purchased and used for exempt 5
purposes. Beginning on October 1, 2025, any nonprofit 6
entity to which a person who is eligible to claim a refund 7
as provided in this s ection submits all documentation and 8
information required to make a refund application may make a 9
claim for such person's refund as provided in this section. 10
Upon approval, the refund shall be made to such nonprofit 11
entity. The claim shall [not be transferred or assigned and 12
shall] be filed not more than three years after the date the 13
motor fuel was imported, removed or sold if the claimant is 14
a supplier, importer, exporter or distributor. If the claim 15
is filed by the ultimate consumer, a consume r must file the 16
claim within one year of the date of purchase or April 17 SB 774 15
fifteenth following the year of purchase, whichever is 18
later. The claim statement may be submitted electronically, 19
and shall be supported by documentation as approved by the 20
director and shall include the following information: 21
(1) Date of sale; 22
(2) Name and address of purchaser; 23
(3) [Name and address of seller; 24
(4)] Number of gallons purchased and base price per 25
gallon; 26
[(5)] (4) Number of gallons pu rchased and charged 27
Missouri fuel tax, as a separate item; [and 28
(6)] (5) Number of gallons purchased and charged sales 29
tax, if applicable, as a separate item ; and 30
(6) If the claim is submitted by a nonprofit entity: 31
(a) Documentation of the nonprofit entity's tax -exempt 32
status; and 33
(b) A statement signed by the purchaser indicating 34
that the nonprofit entity is entitled to the purchaser's 35
refund. 36
2. If the original sales slip or invoice is lost or 37
destroyed, a statement to that effect shall accompany the 38
claim for refund, and the claim statement shall also set 39
forth the serial number of the invoice. If the director 40
finds the claim is otherwise regular, the director may allow 41
such claim for refund. 42
3. The director may make any investigation necessary 43
before refunding the motor fuel tax to a person and may 44
investigate a refund after the refund has been issued and 45
within the time frame for making adjustments to the tax 46
pursuant to this chapter. 47
4. In any case where a refund would be payable to a 48
supplier pursuant to this chapter, the supplier may claim a 49 SB 774 16
credit in lieu of such refund for a period not to exceed 50
three years. 51
5. Every person shall maintain and keep for a period 52
of three years records to substantiate all claims for refund 53
of the motor fuel tax, together with invoices, original 54
sales slips marked paid by the seller, bills of lading, and 55
other pertinent records and paper as may be required by the 56
director for reasonable administration of this chapter. The 57
requirement to maintain records shall be the responsibility 58
of any nonprofit entity to which a purchaser submits claim 59
records required by this section. 60
6. Motor fuel tax that has been paid more than once 61
with respect to the same gallon of motor fuel shall be 62
refunded by the director to the person who last paid the tax 63
after the subsequent taxable event upon submitting proof 64
satisfactory to the director. 65
7. Motor fuel tax that has otherwise been erroneously 66
paid by a person shall be refunded by the director upon 67
proof shown satisfactory to the director. 68
8. If a refund is not issued within forty -five days of 69
an accurate and complete filing, as required by this 70
chapter, the director shall pay interest at the rate 71
provided in section 32.065 accruing after the expiration of 72
the forty-five-day period until the date the refund is 73
issued. 74
9. The director shall promulgate rules as necessary to 75
implement the provisions of this section. Any rule or 76
portion of a rule, as that term is defined in section 77
536.010, that is created under the authority delegated in 78
this section shall become effective only if it complies with 79
and is subject to all of the provisions of chapter 536 and, 80
if applicable, section 536 .028. This section and chapter 81 SB 774 17
536 are nonseverable and if any of the powers vested with 82
the general assembly pursuant to chapter 536 to review, to 83
delay the effective date, or to disapprove and annul a rule 84
are subsequently held unconstitutional, the n the grant of 85
rulemaking authority and any rule proposed or adopted after 86
August 28, 2021, shall be invalid and void. 87