HOUSE BILL NO. 178

INTRODUCED BY HIBBARD C

BY REQUEST OF THE REVENUE OVERSIGHT COMMITTEE

A BILL FOR AN ACT ENTITLED: "AN ACT IMPOSING AN EXCISE TAX ON THE FINAL CONSUMPTION OF ELECTRICITY BASED ON KILOWATT HOURS CONSUMED OR ON THE DELIVERED PRICE PAID BY A SELF-ASSESSING PURCHASER; PROVIDING EXCEPTIONS; SUBMITTING THE CONSUMPTION TAX TO THE QUALIFIED ELECTORS OF MONTANA; PROVIDING A CONTINGENT VOIDNESS PROVISION; AND PROVIDING AN EFFECTIVE DATE."

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:

NEW SECTION. Section 1. Kilowatt hour tax rate -- self-assessing purchaser rate of tax -- exceptions -- exemptions. (1) (a) Except as provided in subsections (1)(b), (2), and (3), a tax is imposed on all electricity for use or consumption and not for resale in this state at the rate of 0.25 cent per kilowatt hour delivered to the customer in a month. The tax is imposed on the purchaser and must be collected by the distribution services provider.

(b) The kilowatt hour tax referred to in subsection (1)(a) is 0.175 cent per kilowatt hour delivered to the customer in a month by an electric utility that has deferred compliance with Title 69, chapter 8, pursuant to 69-8-201. The tax is imposed on the purchaser and must be collected by the electric utility.

(2) (a) In lieu of the tax imposed in subsection (1), a tax is imposed on a self-assessing purchaser at the rate of 5.1%, except as provided in subsections (2)(b) and (3), of the self-assessing purchaser's delivered price for all electricity for use or consumption and not for resale delivered to the self-assessing purchaser in a month.

(b) The tax rate on a self-assessing purchaser who is a customer of an electric utility described in subsection (1)(b) is 3.1% of the self-assessing purchaser's delivered price for all electricity for use or consumption and not for resale delivered to the self-assessing purchaser in a month.

(3) (a) Sales of electricity to customers of a municipal utility described in 69-8-103(5)(b) or to customers whose electricity is delivered on distribution facilities controlled or operated as of May 2, 1997, by a rural electric cooperative organized under the provisions of Title 35, chapter 18, are exempt from the tax imposed by this section.

(b) Sales of electricity to a customer whose supplier of electricity is an entity of the United States government are exempt from the tax imposed by this section.

NEW SECTION. Section 2. Submission to electorate. This act shall be submitted to the qualified electors of Montana at the election to be held in 1999 by printing on the ballot the full title of this act and the following:

SHALL A NEW TAX TO PARTIALLY REPLACE LOST PROPERTY TAX REVENUE FROM ELECTRIC UTILITIES AND CERTAIN RURAL ELECTRIC COOPERATIVES BE IMPOSED?

[]	FOR imposing a consumption tax on the sale of electricity to partially fund decreases in property taxes of electric utilities and certain rural electric cooperatives.

[]	AGAINST imposing a consumption tax on the sale of electricity to partially fund decreases in property taxes of electric utilities and certain rural electric cooperatives.

NEW SECTION. Section 3. Contingent voidness. (1) If Constitutional Initiative No. 75, enacting Article VIII, section 17, of the Montana constitution, is declared invalid, then this act is void.

(2) If LC 380 is not passed and approved, then this act is void.

NEW SECTION. Section 4. Effective date. If approved by the electorate, this act is effective January 1, 2000.

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