Topic: SD to collect an additional 20-cents-per-gallon tax from blender pumps (Read 1775 times)

Dan M · « **on:** April 29, 2008, 06:45:05 PM »

Two Democratic state senators Monday called on Gov. Mike Rounds to rescind what they call an unlawful new tax imposed by the administration on certain blends of ethanol.

In a memo sent April 17 to state gas outlets, the Department of Revenue and Regulation told owners they would need to use a new tax return for all mid-grade ethanol blends by May 1. The Blender Pump Return Tax requires retailers to collect an additional 20-cents-per-gallon tax from consumers who use blender pumps to create their own blends.

Senate Minority Leader Scott Heidepriem said the new tax is unlawful because it conflicts with an existing statute about ethanol taxation. Heidepriem said the Legislature rejected similar proposals earlier this year, and he accused the governor of using executive fiat to ram through an unpopular tax.

"This proposal defies the Legislature. It defies existing law, because it's already taxed. But worst of all, it defies logic," he said.

http://www.argusleader.com/apps/pbcs.dll/article?AID=/20080429/NEWS/804290312/1001/news

Dan M · « **Reply #9 on:** June 10, 2008, 05:27:03 AM »

And the fight continues

http://www.argusleader.com/apps/pbcs.dll/article?AID=/20080610/NEWS/806100307/1001

Gov. Mike Rounds' administration has essentially raised a tax without legislative approval, the Legislature's executive board charges in a letter approved Monday.

The letter urges Rounds to rescind a recent ethanol tax reporting plan and wait until the 2009 session to deal with the issue. The board reviewed the wording of the letter that it had authorized at its May meeting.

The Executive Board letter expressed "deep concern" over the tax form and said the issue was "discussed and debated before a legislative committee extensively and ... the message of the Legislature was clear. That message was to leave the tax and reporting structure as it is currently promulgated."

"That is the equivalent of passing a tax increase without the consent of the Legislature," it said. "This action greatly concerns the Executive Board, as the action of adopting tax increases rests solely within the jurisdiction of the Legislature."

The fight is over the proper way to tax mid-range ethanol blends produced through a process called a blender pump. A proposal that Rounds supported last session died in a Senate committee. After the legislative session, the governor's revenue department issued a new tax-reporting form that he said shows retailers how much tax to collect on blender-pump sales, but that many legislators say ignores their decision not to pass his proposal.

State law taxes regular unleaded gasoline at 22 cents a gallon, E10 at 20 cents a gallon and E85 at 10 cents a gallon. It might seem that a 30 percent blend should be taxed at a rate between 20 cents and 10 cents, but Paul Kinsman, secretary of Rounds' Department of Revenue and Regulation, says the law requires any blend short of E85 be taxed at 20 cents a gallon.

Rounds argues that unless legislators change the law, he must enforce a 20-cent tax on mid-range ethanol blends.

Rep. Rich Engels, D-Hartford, said he reviewed the fuel-tax laws and "the governor doesn't have a leg to stand on here."

hotrod · « **Reply #8 on:** May 13, 2008, 05:49:05 AM »

Interesting, sounds like the legislature blew off the Governor when he raised the issue last year and now they are pissing and moaning because he is calling their bluff, and trying to enforce the letter of the law that they refused to modify in the last session.

Sounds like an internal power game, not an attack on ethanol --- just the normal bushwhackery that comes with politics.

Larry

Dan M · « **Reply #7 on:** May 13, 2008, 05:36:27 AM »

Update:

Panel rebukes Rounds on tax memo

PIERRE - The Legislature's Executive Board on Monday sent a stern message to Gov. Mike Rounds to rescind what they say is a new tax on mid-range ethanol blends.

The board, made up of Republicans and Democrats from both chambers, voted 11-2 to "insist" that the governor rescind a Revenue and Regulation Department memo that gives fuel retailers a new blender-pump tax form and guidelines.

http://www.argusleader.com/apps/pbcs.dll/article?AID=/20080513/NEWS/805130304/1001

DragonWhip · « **Reply #6 on:** May 04, 2008, 10:45:38 AM »

GOV..... Why do they have to make a simple operation so complicated? If the rule is that stupid get rid of it I say. It's like combat, if your in a combat area it should be a free fire zone. none of these stupid rules when someone is trying to kill you. Sometimes, make that most times Gov and politicians P_ss me off with their stupidity. Later.

furball64801 · « **Reply #5 on:** May 04, 2008, 09:33:24 AM »

I hate hearing this stuff, there trying to kill us arent they.

Dan M · « **Reply #4 on:** May 04, 2008, 08:05:55 AM »

Another article on it today..

Blender fuel tax causes ruckus

PIERRE - Here's a confusing piece of the flap over blender pump taxes: Mix it yourself and the tax is lower than if the gas station does it for you.

That's the current interpretation of existing law by Gov. Mike Rounds and his revenue agency.

The difference, Rounds said in a recent meeting with reporters, is that when the customer does the blending, two separate transactions are involved. When the blended fuel - even if it's the same blend that a customer might make - flows out of a blender pump, it must be taxed at the higher of two rates in law for ethanol blends.

The issue of ethanol taxes has been at issue all week, with critics of the governor's interpretation saying it amounts to taxing the same product twice and it will discourage the growth of blender pumps across the state.

"Blender pumps and midlevel ethanol blends are the future of the industry," Rob Skjonsberg, vice president of Poet said in an e-mail message

http://www.argusleader.com/apps/pbcs.dll/article?AID=/20080504/NEWS/805040306/1001/news

What do they say even bad press is good press..

this debate must be lifting the awareness of blender pumps..and at the right level

mpersell · « **Reply #3 on:** April 29, 2008, 10:16:29 PM »

Never lose sight of the reason for taxing powers residing in any governing or legislating body. The power to tax is the power to control. As renewable fuels either flourish or die in the next period of months it will be because it was manipulated for popularity's sake or it was over taxed to control its growth. If you look at the source of the new taxes you'll probably find someone lobbied heavy by oil.

furball64801 · « **Reply #2 on:** April 29, 2008, 10:07:44 PM »

Looks like we have more idiots that want to spoil the pourage.

cessna · « **Reply #1 on:** April 29, 2008, 09:08:31 PM »

I'm not sure I totally understand this. If I go to the trouble of pumping a few gallons from a dedicated E85 pump and then some from a dedicated 10% pump to make a 30% blend, do I pay less tax than if it comes out of the blender under the new rule. If that's the case then it is unfair IMHO.