Motor Fuels Tax Crime: How It Hurts Texas
Motor fuels tax provides the fourth-largest source of state tax revenue. In fiscal 2012, Texas motor fuels tax collections totaled $3.1 billion. This revenue is then allocated to:
- public education
- highways
Case News Release
July 6, 2012: Calvin Russell Laird, 50, of Lawn, was sentenced to twenty years in prison for motor fuel tax fraud. It is the maximum sentence allowed by law for Evading Motor Fuel Tax, a second-degree felony that is the highest criminal charge in Chapter 162 of the Tax Code. Laird was accused by indictment of intentionally and knowingly evading and attempting to evade motor fuel tax by delivering dyed diesel into the fuel tank of a motor vehicle for use upon a public highway. The case, filed as cause number 24940-A, was prosecuted in Taylor County by the Taylor County District Attorney’s Office.
Motor Fuels Tax Investigations
Motor fuel taxes are set by the Legislature and
collected by the Comptroller of Public Accounts.
Crimes and penalties related to the motor fuels tax
are described in Tax Code Chapter 162, Subchapter E. These crimes
range from misdemeanors to second-degree felonies, the
punishment range for which is 2 to 20 years in
prison.
Tax Code §162.403 lists 39 criminal offenses relating to motor fuels. Felony conduct under §162.403 includes:
- selling or delivering dyed diesel fuel (fuel which is untaxed because it is not intended for use on public highways) for the operation of a motor vehicle on a public highway (a third-degree felony);
- blending fuel to expand its volume and thus evade motor fuels taxes (a second-degree felony);
- failing to remit any motor fuel tax funds collected. (a second-degree felony);
- destroying required books and records (a third-degree felony); and
- making false entries in required books and records (a third-degree felony).
View the full text of state laws pertaining to motor fuels tax crimes
Other Consequences in Addition to Criminal Punishment
The Comptroller's office may cancel or refuse to issue or reissue a Chapter 162 license to any applicant who has violated or failed to comply with a provision of this chapter or a rule issued by the Comptroller (see Tax Code §162.005). In some cases, this can occur without prior notice (see Tax Code §162.006).
Motor Fuels Tax Prosecutions
Motor fuels offenses can be prosecuted in the county in which they occur or in Travis County (see Tax Code §162.407). Local prosecutors generally prosecute motor fuels misdemeanors in the county in which they occurred. Most felonies are prosecuted by the Motor Fuels Tax Fraud Division of the Travis County District Attorney's Office.
The Motor Fuels Tax Fraud Division is a state-funded unit comprised of prosecutors, investigators, crime analysts and support personnel who are specially trained in motor fuels prosecutions, which can be highly complex and document-intensive. Although the unit prosecutes all types of motor fuels felonies, its main strength is its ability to prosecute, in a coordinated manner, multi-defendant cases that involve crimes in multiple counties along a supply or distribution chain.
This centralized prosecution has greatly improved the state's ability to recoup funds and has resulted in significant prison sentences for offenders.
To contact the Motor Fuels Tax Fraud Division of the Travis County District Attorney's Office, call 512-854-9530.