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IFTA Ballot Proposals Comments

IFTA Ballot Comments

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1st Period Comments on FTPBP #7 - 2025

Jurisdiction	Position	Comments
Attorney Advisory Committee		The ballot proposes to amend the formula in P1060.100 of the Procedures Manual to replace certain references to “tax” with “amount” in order to be more inclusive of the amounts to be allocated to member jurisdictions. The ballot references accrued interest on a late return [more accurately, on a late payment] as another amount (other than tax) that may be allocable. The rationale for the proposed amendment is, effectively, consistency with R1380 of the Agreement, which provides a similar, but more broadly worded, formula in respect of the allocation of fuel tax adjustments resulting from audit findings. P1060 provides a procedure for the allocation of “tax”. This procedure is consistent with the mandatory imposition in R910, which requires the base jurisdiction to pay all “taxes” due to all member jurisdictions. R920 also refers to the “payment of taxes” due to the base jurisdiction for all members. The Agreement does not define “tax” to include other amounts, such as interest. While licensees are required to pay tax pursuant to R910, the Agreement does not directly require a licensee to pay interest. That is, in accordance with R1230, a base jurisdiction is mandatorily required to assess interest on taxes due that are considered delinquent (in accordance with R970). R1210.300, which is in respect of assessments, requires a base jurisdiction to, “after adding the appropriate penalties and interest”, serve the assessment upon the respective licensee. However, R1210 does not clarify that the amounts assessed, including interest, become liabilities due from the licensee. It is acknowledged that the motor fuel tax legislation in certain jurisdictions may more clearly state that interest is payable on any amounts owing or assessed, and/or may state that evidence that an assessment of tax, penalties or interest has been made is proof that the amount is owing from the person on whom the assessment was issued. However, it is not known whether the legislation of all member jurisdictions includes such clarity. In any event, it is suggested that the proposed amendment to P1060 does not provide sufficient clarity that the “amount” to be allocated includes anything other than tax. Accordingly, it is suggested that the proposed amendment be updated as follows (acknowledging that penalties are not allocable, but rather are retained by the base jurisdiction pursuant to R1220.200): *P1060 ALLOCATION OF TAX AND ASSESSED INTEREST Should a licensee file a tax return showing taxes due and fail to remit payment in full with the tax return, the base jurisdiction may choose one of two options in remitting the appropriate tax , and any interest assessed in relation to the tax, to other member jurisdictions: .100 Option 1 The base jurisdiction may allocate the actual tax payment, and actual payment of any interest assessed in relation to the tax payment, to the other members based on the following formula: Allocation to Members = (Net ~~Tax~~ Amount Due Each Member/Net ~~Tax~~ Amount Due All Members) x ~~Money~~ Payments Available to Allocate It is also suggested that P1060.200 be amended for consistency with how P1060.100 is amended, for example, by referring to “any interest assessed in relation to the reported tax”. Furthermore, it is noted that the opening paragraph of P1060 refers to a failure to “remit payment in full”, which encompasses the situation where only partial payment is made (Option 1) as well as the situation where no payment is made at all (Option 2). However, the opening paragraph of P1060.200 (in respect of Option 2) similarly refers to a failure to remit “full payment”, which (like the wording in the opening paragraph of P1060) could reasonably be interpreted to mean that the licensee did not remit the entire amount due, but did remit part thereof. However, Option 2 is based on the premise that no amount was paid at all. Therefore, for clarity (and consistency with the opening paragraph of P1060), it is also suggested that P1060.200 be amended to replace “full” with “any” in respect of the lack of payment. That is, it is suggested that P1060.200 be updated as follows: .200 Option 2 When a licensee files a tax return and fails to remit full any payment with the tax return, full payment of the reported tax and any interest assessed in relation to the reported tax, ~~if any, will~~ may be made by the base jurisdiction to the member jurisdictions involved. The base jurisdiction will assume the liabilities for the payments made to the other jurisdictions. The base jurisdiction will then be responsible for collection of the unpaid tax and any interest due from the licensee and will follow the methods of collection governed by the laws of the base jurisdiction and administrative procedures of the Agreement. It is also noted that the opening sentence of R1380, Communication of Audit Findings, refers to fuel “tax” adjustments, which arguably frames the context of such adjustments, as well as frames the context of subsequent references in R1380 to “funds”, “audit funds”, “additional money owed”, “amount due”, and “audit liability”. While such subsequent terms are broad, for the same reasons noted above in respect of P1060, it is not clear that a licensee is required under the Agreement to pay anything other than tax. Accordingly, it is suggested that the wording of R1380 be reviewed and amendments proposed in a future ballot, if considered appropriate. As part of that review, it is also suggested that the terminology used in R1380 to refer to the allocable amount be made consistent, perhaps by including a defined term that clearly specifies what allocable audit adjustments include.
IOWA	Oppose	Iowa is not in favor of this ballot as written. We believe the language change should be in the Articles of Agreement to change wording from “amount” to tax, and not P1060 Allocation of Tax, which is proposing to change from “tax” to “amount”.
KANSAS	Support
KENTUCKY	Support
MANITOBA	Support
MARYLAND	Support
MICHIGAN	Support
NEVADA	Support	Language being changed is to include interest paid to the Juris and due to the member jurisdictions.
NEW BRUNSWICK	Support
NEWFOUNDLAND	Support
NORTH CAROLINA	Support	North Carolina has no comments for this ballot and supports it as currently written.
OKLAHOMA	Support
ONTARIO	Support
PENNSYLVANIA	Support
QUEBEC	Support
SASKATCHEWAN	Support	The proposed change appears to be in alignment with the intention of Option 1 for the distribution of funds.
SOUTH DAKOTA	Support
Support: 16 Oppose: 1 Undecided: 0

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