SENATE BILL REPORT

EHB 403

BYRepresentatives Walk and Schmidt; by request of Department of Transportation

Transferring responsibility for aircraft registration and excise tax collection to the department of transportation.

House Committe on Transportation

Senate Committee on Transportation

Senate Hearing Date(s):March 25, 1987

Majority Report:  Do pass.

      Signed by Senators Peterson, Chairman; Hansen, Vice Chairman; Tanner, Vice Chairman; Bailey, Bender, Conner, DeJarnatt, Garrett, Halsan, Johnson, Nelson, Patterson, Sellar, Smitherman, von Reichbauer, West.

Senate Staff:Robin Rettew (786-7306)

                  March 26, 1987

AS REPORTED BY COMMITTEE ON TRANSPORTATION, MARCH 25, 1987

BACKGROUND:

Pilot registration fees are currently collected by the Department of Transportation, but aircraft registration and aircraft excise taxes are collected by the Department of Licensing.  This split of administrative responsibilities creates confusion for the taxpayer.

An increasing number of small aircraft are being certified by the Federal Aviation Administration (FAA) to use motor fuel.  Although individuals using motor fuel in an aircraft are entitled to a refund, many individuals do not bother with collecting their refunds.  However, if a refund is collected, then use tax liability arises.  The use tax is credited to the general fund.

SUMMARY:

Responsibility for administering aircraft registration fees and aircraft excise taxes is transferred to the Department of Transportation (DOT).  The cost for administering these taxes will be met by transferring 10 percent of the excise taxes from the general fund to the aeronautics account.  In addition, an annual transfer will be made from the motor vehicle fund to both the aeronautics account and to the general fund.  These transfers will equal the difference between .028 percent of gross motor vehicle fuel tax receipts and the total amount of refunds claimed for motor fuel purchases used for non- highway purposes.

DOT is granted authority to require aircraft registrations on a staggered basis and to raise registration fees from $5 to $10.  There is no plan to change either the collection date or to increase the fees for the 1987-89 biennium.

Appropriation:    $223,787 is appropriated from the Aeronautics Account of the General Fund to the Department of Transportation.

Fiscal Note:      available

Senate Committee - Testified: Bill Hamilton, DOT