Bill would exempt certain high-ethanol gasoline bought for farm use

The proposal says qualifying purchases would not be charged the state fuel excise tax. This covers ethanol-blended gasoline with more than 85 percent ethanol, bought for farm machinery used in agricultural production. The fuel must be bought at a terminal or refinery rack solely for the specified farm use.

Buyers must document exempt purchases, and buyers who use or dispose of the fuel in a nonexempt way must pay the tax directly to the department. These rules apply to buyers and suppliers claiming the exemption for the specified gasoline. The buyer must complete and sign a correct exemption certificate that meets the revenue director's requirements. The department must disallow a sale as exempt unless an exemption certificate proves it qualifies. Suppliers must keep each exemption certificate for at least three years.