Refund of motor fuel excise taxes for actual off-highway use of certain mobile machinery vehicles

(a)

In general

Subparagraph (C) of section 6421(e)(2) of the Internal Revenue Code of 1986 (relating to off-highway business use of mobile machinery) is amended by adding at the end the following new clauses:

(v)

Use of mobile machinery with greater highway miles

If— (I)a vehicle meets the requirements of clause (iii) but does not (but for this clause) meet the requirements of clause (iv), and (II)more than 50 percent of the fuel use of such vehicle during a taxable year is in non-propulsive operations,

such vehicle shall be treated as meeting the requirements of clause (iv) for such taxable year.

(vi)

Amount of fuel used in non-propulsive operations

For purposes of vehicles described in clause (v), (I)only the fuel used in non-propulsive operations may be taken into account as off-highway business use of such vehicle for such taxable year, and (II)the Secretary shall establish standard percentage exemption rates for vehicle types that the Secretary determines to qualify under clause (v).

(b)

Refunds borne by general fund

Paragraph (2) of section 9503(c) of such Code (relating to transfers from Highway Trust Fund for certain repayment and credits) is amended by adding at the end the following new subparagraph:

(D)

Exception for use in certain mobile machinery

Subparagraph (A) shall not apply to amounts paid by reason of clauses (v) and (vi) of section 6421(e)(2)(C).

(c)

Effective date

The amendments made by this section shall apply to taxes on fuel used in taxable years beginning after the date of the enactment of this Act.