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Relating to an exemption from motor fuel taxes for certain fuel used by a rural transit district to provide public transportation.
Estimated two-year net impact to general revenue related funds for HB 1294, Committee Report 1st House, substituted: a negative impact of ($41,000) through the biennium ending August 31, 2023.
HB 1294 would amend the Tax Code to make rural transit districts exempt from paying taxes on the purchase of gasoline, diesel, and natural gas used exclusively to provide public transportation. Rural transit districts would also be allowed to apply for a refund of qualified motor vehicle sales taxes meeting several specified conditions.
Without commenting on rural transit districts themselves since they are already provided for in statute, we do not see a liberty principle connection to this bill and remain neutral. We generally oppose tax exemptions of any kind, however it makes little sense for one unit of government to pay taxes to another unit of government, particularly in a case such as this where the rural transit district would be paying the state motor vehicle fuels tax using funds it received from the state to begin with.