Oklahoma 2023 Regular Session

Oklahoma Senate Bill SB605 Compare Versions

Version 1 (Old)

Version 2 (New)

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4		-	An Act
5		-	ENROLLED SENATE
	29	+	HOUSE OF REPRESENTATIVES - FLOOR VERSION
	30	+
	31	+	STATE OF OKLAHOMA
	32	+
	33	+	1st Session of the 59th Legislature (2023)
	34	+
	35	+	ENGROSSED SENATE
6	36		BILL NO. 605 By: Rader of the Senate
7	37
8	38		and
9	39
10	40		Pfeiffer of the House
11	41
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15	45		An Act relating to income tax credit; amending 68
16	46		O.S. 2021, Section 2357.22, as amende d by Section 1,
17	47		Chapter 404, O.S.L. 2022 (68 O.S. S upp. 2022, Section
18	48		2357.22), which relates to one-time credit for
19	49		investments in qualified clean -burning motor vehicle
20	50		fuel property; modifying certain required calculation
21	51		by the Oklahoma Tax Commission for certain fiscal
22	52		years; providing an effective date; and declaring an
23	53		emergency.
24	54
25	55
26	56
27		-	~~SUBJECT: Income tax credit~~
	57	+
28	58
29	59		BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
30		-
31	60		SECTION 1. AMENDATORY 68 O.S. 2021, Section 2357.22, as
32	61		amended by Section 1, Chapter 404, O.S.L. 2022 (68 O.S. Supp. 2022,
33	62		Section 2357.22), is amended to read as follows:
34		-
35	63		Section 2357.22. A. For tax years 2028 and before, there shall
36	64		be allowed a one-time credit against the income tax imposed by
37	65		Section 2355 of this title for investments in qualified clean-
38	66		burning motor vehicle fuel property placed in service on or after
39	67		January 1, 1991.
40	68
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41	95		B. As used in this section, “qualified clean-burning motor
42	96		vehicle fuel property ” means:
43		-
44	97		1. Equipment installed to modify a motor vehicle which is
45	98		propelled by gasoline or diesel fuel so that the vehicle may be
46	99		propelled by compressed natural gas, liquefied n atural gas, or
47		-
48		-	ENR. S. B. NO. 605 Page 2
49	100		liquefied petroleum gas. The equip ment covered by this paragraph
50	101		must:
51		-
52	102		a. be new, not previously used to modify or retrofit any
53	103		vehicle propelled by gasoline or diesel fuel and be
54	104		installed by an alternative fuels equipment technician
55	105		who is certified in accordance with the Alternative
56	106		Fuels Technician Certification Act,
57		-
58	107		b. meet all Federal Motor Vehicle Safety Standards set
59	108		forth in 49 CFR 571, or
60		-
61	109		c. for any commercial moto r vehicle (CMV), follow the
62	110		Federal Motor Carrier Safety Regulations or Oklahoma
63	111		Intrastate Motor Carrier Regulations;
64		-
65	112		2. A motor vehicle originally equippe d so that the vehicle may
66	113		be propelled by compressed natural gas, or liquefied natural gas or
67	114		liquefied petroleum gas but only to the extent of the portion of the
68	115		basis of such motor vehicle which is attributable to t he storage of
69	116		such fuel, the delivery to the e ngine of such motor vehicle of such
70	117		fuel, and the exhaust of gases from combustion of such f uel;
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72	145		3. Property, not including a building and its structural
73	146		components, which is:
74		-
75	147		a. directly related to the delive ry of compressed natural
76	148		gas, liquefied natura l gas or liquefied petroleum gas,
77	149		or hydrogen for commercial purposes or for a fee or
78	150		charge, into the fuel tank of a motor vehicle
79	151		propelled by such fuel inclu ding compression equipment
80	152		and storage tanks for s uch fuel at the point where
81	153		such fuel is so delivered but only if such property is
82	154		not used to deliver such fuel into any other type of
83	155		storage tank or receptacle and such fuel is not used
84	156		for any purpose other than to propel a motor vehicle,
85	157		or
86		-
87	158		b. a metered-for-fee, public access recharging system for
88	159		motor vehicles propelled in whole or in part by
89	160		electricity. The property covered by this paragraph
90	161		must be new, and must not have been previously
91		-
92		-	ENR. S. B. NO. 605 Page 3
93	162		installed or used to refuel vehicles powered by
94	163		compressed natural gas, liquefied natural gas or
95	164		liquefied petroleum gas, hydrogen, or electricity.
96		-
97	165		Any property covered by this paragraph which is re lated to the
98	166		delivery of hydrogen into the fuel tank of a motor vehi cle shall
99	167		only be eligible for tax years 2010 and 2023 through 2028;
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101	195		4. Property which is directly related to the compression and
102	196		delivery of natural gas from a private home or residence, for
103	197		noncommercial purposes, into the fuel tank of a motor vehicle
104	198		propelled by compressed natural gas. The property cove red by this
105	199		paragraph must be new and must not have been previously installed or
106	200		used to refuel vehicles powered by natural gas; or
107		-
108	201		5. For tax years 2010 and 2023 through 2028, a motor vehicle
109	202		originally equipped so that the vehicle may be propelled by a
110	203		hydrogen fuel cell electric fueling system .
111		-
112	204		C. As used in this section, “motor vehicle” means a motor
113	205		vehicle originally designed by the manufacturer to operate lawfully
114	206		and principally on streets and highways.
115		-
116	207		D. The credit provided for in subsection A of this section
117	208		shall be as follows:
118		-
119	209		1. For the qualified clean-burning motor vehicle fuel property
120	210		defined in paragraphs 1, 2, or 5 of subsection B of this section,
121	211		the amount of the credit shall be as follows based upon gross
122	212		vehicle weight of the qualified vehicle:
123		-
124	213		a. for vehicles up to or below six thousand (6,000)
125	214		pounds, the credit shall be a maximum of Five Thousand
126	215		Five Hundred Dollars ($5,500.00),
127		-
128	216		b. for vehicles between six thousand one (6,001) pounds
129	217		to ten thousand (10,000) poun ds, the credit shall be a
130	218		maximum amount of Nine Thousand Dollars ($9,000.00),
131	219
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132	246		c. for vehicles of ten thousand one (10,001) pounds, but
133	247		not in excess of twenty-six thousand five hundred
134		-
135		-	ENR. S. B. NO. 605 Page 4
136	248		(26,500) pounds, the credit shall be a maximum amount
137	249		of Twenty-six Thousand Dollars ($26,000.00), and
138		-
139	250		d. for vehicles in excess of twenty-six thousand five
140	251		hundred one (26,501) pounds, the credit shall be a
141	252		maximum amount of One Hundred Thousand Dollars
142	253		($100,000.00);
143		-
144	254		2. For qualified cl ean-burning motor vehicle fuel property
145	255		defined in paragraph 3 of subsection B of this section, a per-
146	256		location credit of forty-five percent (45%) of the cost of the
147	257		qualified clean-burning motor vehicle fuel property; and
148		-
149	258		3. For qualified clean-burning motor vehicle fuel property
150	259		defined in paragraph 4 of subsection B of this section, a per-
151	260		location credit of the lesser of fifty percent (50%) of the cost of
152	261		the qualified clean-burning motor vehicle fuel property or Two
153	262		Thousand Five Hundred Dollars ($2,500 .00).
154		-
155	263		E. In cases where no credit has been cl aimed pursuant to
156	264		paragraph 1 of subsection D of this section by any prior owner and
157	265		in which a motor vehicle is purchased by a taxpayer with qualified
158	266		clean-burning motor vehicle fuel property installed by the
159	267		manufacturer of such motor vehicle and the ta xpayer is unable or
160	268		elects not to determine the exact basis which is attributable to
161	269		such property, the taxpayer may claim a credit in an amount not
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162	297		exceeding the lesser of ten percent (10%) of the cost of the motor
163	298		vehicle or One Thousand Five Hundred Dol lars ($1,500.00).
164		-
165	299		F. If the tax credit allowed pursuant to subsection A of this
166	300		section exceeds the amount of income taxes due or if there are no
167	301		state income taxes due on the income of the taxpayer, the amoun t of
168	302		the credit not used as an offset against the income taxes of a
169	303		taxable year may be carried forward, in order, as a credit against
170	304		subsequent income tax liability for a period not to exceed five (5)
171	305		years. The tax credit authorized pursuant to the pro visions of this
172	306		section shall not be used to r educe the tax liability of the
173	307		taxpayer to less than zero (0).
174		-
175	308		G. A husband and wife who file separate returns for a taxable
176	309		year in which they could have filed a joint return may each claim
177		-
178		-	ENR. S. B. NO. 605 Page 5
179	310		only one-half (1/2) of the tax credit that would have been allow ed
180	311		for a joint return.
181		-
182	312		H. The Oklahoma Tax Commission is herein empowered to
183	313		promulgate rules by which the purpose of this section shall be
184	314		administered including the power to establish and enforce penalties
185	315		for violations thereof.
186		-
187	316		I. Notwithstanding th e provisions of Section 2352 of this
188	317		title, for the fiscal year beginning on July 1, 2014, and each
189	318		fiscal year thereafter through fiscal year 2023 , the Tax Commission
190	319		shall calculate an amount that equals five percent (5%) o f the cost
191	320		of qualified clean-burning motor vehicle fuel property as provided
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192	348		for in paragraph 1 of subsection D of this section for tax year
193	349		2012. For each subsequen t fiscal year thereafter, the Tax
194	350		Commission shall perform the same computation with resp ect to the
195	351		second tax year preceding the beginning of each subsequent fiscal
196	352		year. For fiscal year 2024, the Tax Commission shall calculate an
197	353		amount that equals twelve percent (12%) of the credit for qualified
198	354		clean-burning motor vehicle fuel property as provided in paragraph 1
199	355		of subsection D of this section for tax year 2021. For each
200	356		subsequent fiscal year, the Tax Commission shall perform the same
201	357		calculation for credits claimed in the second preceding tax year.
202	358		The Tax Commission shall then transfe r an amount equal to the amount
203	359		calculated in this subsection from the revenue derived pursuant to
204	360		the provisions of subsections A, B and E of Section 2355 of this
205	361		title to the Compressed Nat ural Gas Conversion Safety and Regulation
206	362		Fund created in Section 130.25 of Title 74 of the Oklahoma Statutes.
207		-
208	363		J. For the tax years 2020 through 2022, the total amount of
209	364		credits authorized by this section used to offset t ax shall be
210	365		adjusted annually to limit the annual amount of credits to Twenty
211	366		Million Dollars ($20 ,000,000.00). The Tax Commission shall annually
212	367		calculate and publish by the first day of the affected taxable year
213	368		a percentage by which the credits authori zed by this section shall
214	369		be reduced so the total amount of credits used to offset tax does
215	370		not exceed Twenty Million Dollars ($20,000,000.00) per year. The
216	371		formula to be used for the percentage adjustment shall be Twenty
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217	399		Million Dollars ($20,000,000.00) divided by the credits claimed in
218	400		the second preceding year, with respect to a ny changes to the fu ture
219	401		of the credit.
220		-
221		-
222		-	ENR. S. B. NO. 605 Page 6
223	402		K. Pursuant to subsection J of this section, in th e event the
224	403		total tax credits authorized by this section exceed Twenty Million
225	404		Dollars ($20,000,000.00) in any calendar year, the Tax Commission
226	405		shall permit any excess over Twenty Million Dollars ($20,000,000.00)
227	406		but shall factor such excess into the perc entage adjustment formula
228	407		for subsequent years with respect to any changes to the fut ure of
229	408		the credit.
230		-
231	409		L. For the tax years 2023 through 2028, the total amount of
232	410		credits authorized b y this section used to offset tax shall be
233	411		adjusted annually to limit the annual amount of credits to:
234		-
235	412		1. Ten Million Dollars ($10,000,000.00) for qualified clean
236	413		burning fuel property propelled by compressed natural gas, liquefied
237	414		natural gas, or liquefi ed petroleum gas, property related to the
238	415		delivery of compressed natu ral gas, liquefied na tural gas or
239	416		liquefied petroleum gas, and property directly related to the
240	417		compression and deliver y of natural gas;
241		-
242	418		2. Ten Million Dollars ($10,000,000.00) for property originally
243	419		equipped so that the vehicle may be propelled by a hy drogen fuel
244	420		cell electric fueling system and property directly related to the
245	421		delivery of hydrogen; and
246	422
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247	449		3. Ten Million Dollars ($10,000,000.00) for property which is a
248	450		metered-for-fee, public access recharging system for motor vehicles
249	451		propelled in whole or in part by electric ity.
250		-
251	452		The Tax Commission shall annually calculate and publish by the
252	453		first day of the affected taxa ble year a percentage by which the
253	454		credits authorized by this sectio n shall be reduced so the total
254	455		amount of credits used to offset t ax does not exceed each of the
255	456		limits provided in paragraphs 1 through 3 of this subsection . The
256	457		formula to be used for t he percentage adjustment shall be Ten
257	458		Million Dollars ($10,000,000.00) divided by the credits claimed in
258	459		the second preceding year, wi th respect to any change s to the future
259	460		of the credit.
260		-
261	461		M. Pursuant to subsection L of this section, in the event the
262	462		tax credits authorized by this section exceed any of the limits
263	463		provided in paragraphs 1 through 3 of subsection L of this section
264	464		in any year, the Tax Commission shall permit any excess over Ten
265		-
266		-	ENR. S. B. NO. 605 Page 7
267	465		Million Dollars ($10,000,000.00) but shall factor such excess in to
268	466		the percentage adjustment formula for subsequent years with respe ct
269	467		to any changes to the future of the credit.
270		-
271	468		N. The Tax Commission shall notify the Off ice of the State
272	469		Secretary of Energy and Environment at any time when the amount of
273	470		claims for credits allowed pursuant to this section reaches eighty
274	471		percent (80%) of the total annual limit provided in subsection J of
275	472		this section. Upon such notification , the Secretary shall provide
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276	500		notice to the Governor, President Pro Tempore of the Senate and
277	501		Speaker of the House of Representatives.
278		-
279	502		SECTION 2. This act shall become effective July 1, 2023.
280		-
281	503		SECTION 3. It being immediatel y necessary for the preservation
282	504		of the public peace, health or safety, an emergency is hereby
283	505		declared to exist, by reason whereof this act shall take effect and
284	506		be in full force from and after its passa ge and approval.
285	507
286		-
287		-	ENR. S. B. NO. 605 Page 8
288		-	Passed the Senate the 9th day of March, 2023.
289		-
290		-
291		-
292		-	Presiding Officer of the Senate
293		-
294		-
295		-	Passed the House of Representatives the 26th day of April, 2023.
296		-
297		-
298		-
299		-	Presiding Officer of the House
300		-	of Representatives
301		-
302		-	OFFICE OF THE GOVERNOR
303		-	Received by the Office of the Governor this _______ _____________
304		-	day of _________________ __, 20_______, at _______ o' clock _______ M.
305		-	By: _______________________________ __
306		-	Approved by the Governor of the State of Oklahoma this _____ ____
307		-	day of _________________ __, 20_______, at _______ o'clock _______ M.
308		-
309		-	_________________________________
310		-	Governor of the State of Oklah oma
311		-
312		-
313		-	OFFICE OF THE SECRETARY OF STATE
314		-	Received by the Office of the Secretary of State this _______ ___
315		-	day of __________________, 20 _______, at _______ o'clock _______ M.
316		-	By: _______________________________ __
	508	+	COMMITTEE REPORT BY: COMMITTEE ON GENERAL GOVERNMEN T, dated
	509	+	04/11/2023 - DO PASS.