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Business Taxes Law Guide—Revision 2024
Motor Vehicle Fuel Tax Law
Revenue and Taxation Code
Division 2. Other Taxes
Part 2. Motor Vehicle Fuel Tax Law
Chapter 4. Licenses and Bonds.1
Article 1. License for Supplier
Article 2. License for Industrial User
Article 3. License for Pipeline Operator, Train Operator, and Vessel Operator
Article 4. Security
- 7486 Bond requirements [Repealed.]
- 7486 Security requirements
- 7487 Amount of bond [Repealed.]
- 7487 Security; payment on account
Article 5. Denial of License
Article 6. Revocation of License
- 7505 Revocation of license
- 7506 Revocation because of nonuse
- 7507 Notice of revocation
- 7508 Cancellation or revocation of licenses; hearings
- 7509 Tax liability upon revocation
- 7510 Reinstatement
- 7511 Unlawful operation after revocation
Article 7. Licensing of Locations
Chapter 4. Licenses and Bonds.1
1Added by Stats. 2000, Ch. 1053 (AB 2114), operative January 1, 2002.
Article 1. License for Supplier
7451. Supplier license. Every person before becoming a supplier shall apply to the board for a license authorizing the person to engage in business as a supplier on forms prescribed by the board. A supplier's license shall be issued only to a person who is a supplier of motor vehicle fuel as defined in Section 7338. It is unlawful for any person to be a supplier without first securing a license.
7452. Applications. Applications shall be made on forms to be prescribed, prepared, and furnished by the board.
7453. License not transferable. Before granting a license authorizing a person to engage in business as a supplier, the board may require the person to file with the board security pursuant to Section 7486. The license issued to any supplier is not transferable and is valid until canceled or revoked.
History—Stats. 2001, Ch. 429 (AB 309), operative January 1, 2002, added the first sentence.
Article 2. License for Industrial User
7460. Application for industrial user license. Every person before becoming an industrial user shall apply to the board for a license authorizing the person to operate as an industrial user on forms prescribed by the board. An industrial user license shall be issued only to a person who is an industrial user of motor vehicle fuel as defined in Section 7322. It is unlawful for a person to act as an industrial user without first securing a license.
Article 3. License for Pipeline Operator, Train Operator, and Vessel Operator
7470. Application for pipeline operator, train operator, and vessel operator. Every person before becoming a pipeline operator or a vessel operator shall apply to the board for a license on forms prescribed by the board. In addition, every train operator that transports motor vehicle fuel, alcohol, or aircraft jet fuel into, out of, or within this state shall obtain a license from the board on forms prescribed by the board. A pipeline operator license, a train operator license, or a vessel operator license shall be issued only to a person who is a pipeline operator, a train operator, or a vessel operator as defined in Sections 7331, 7342, and 7344. It is unlawful for a person to act as a pipeline operator or a vessel operator without first securing a license. It is unlawful for a train operator to transport motor vehicle fuel, alcohol, or aircraft jet fuel into, out of, or within this state on or after January 1, 2009, without first securing a license under this section or Section 7403.1.
History—Stats. 2008, Ch. 306 (AB 3079), in effect January 1, 2009, added the second and last sentences; and added ", a train operator license," after "A pipeline operator license", "a train operator," after "who is a pipeline operator", and ",7342," after "as defined in Sections 7331" in the third sentence.
Article 4. Security
7486. Bond requirements. [Repealed by Stats. 2001, Ch. 429 (AB 309), operative January 1, 2002.]
7486. Security requirements. The board, whenever it deems it necessary to ensure compliance with this part or any rule or regulation adopted under this part, may require any person to deposit with it any security as it may determine appropriate. The amount of the security shall be fixed by the board but shall not be more than three times the estimated average monthly tax liability of the person. The total amount of security shall not be in excess of one million dollars ($1,000,000) where the person has established to the satisfaction of the board that this security, together with property to which the lien imposed by Section 7872 attaches, is sufficient security to ensure payment of taxes equivalent to three times the estimated average monthly tax liability of the person. The amount of the security may be increased or decreased by the board at any time. Any security in the form of cash or insured deposits in banks and savings and loan institutions shall be held by the board in trust to be used solely in the manner provided for in this section and Section 7487. Any security in the form of a bond or bonds shall be duly executed by an admitted surety insurer, payable to the state, conditioned upon faithful performance of all the requirements of this part, and expressly providing for the payment of all taxes, penalties, and other obligations of the person arising out of this part. Security held by the board shall be released after a three-year period in which the person has filed all returns and paid all tax to the state or any amount of tax required to be collected and paid to the state within the time required.
History—Added by Stats. 2001, Ch. 429 (AB 309), operative January 1, 2002.
7487. Amount of bond. [Repealed by Stats. 2001, Ch. 429 (AB 309), operative January 1, 2002.]
7487. Security; payment on account. If, at the time a person ceases to operate under this part, the board holds a security pursuant to Section 7486 in the form of cash, or insured deposits in banks or savings and loan institutions, the security when applied to the account of the taxpayer shall be deemed to be a payment on account of any liability of the taxpayer to the Controller on the date the person ceases to operate under this part.
History—Added by Stats. 2001, Ch. 429 (AB 309), operative January 1, 2002.
Article 5. Denial of License
7491. Denial of license. The board may refuse to issue a license under this part:
(a) If the application therefor is filed by an applicant who formerly held any license under this part which, prior to the time of filing the application, has been revoked for cause by the board; or
(b) If the board determines that the application therefor is not filed in good faith or made by the real person in interest.
7492. Hearing. Before the refusal, the board shall grant the applicant a hearing and shall give him or her at least 10 days' written notice of the time and place thereof.
7493. Notice of hearing. The notice shall be addressed to the applicant at his or her address as it appears in the records of the board, and shall be given in the manner prescribed in Section 7671 for giving notice of a deficiency determination.
Article 6. Revocation of License
7505. Revocation of license. The board may revoke the license of any person who refuses or neglects to comply with any provisions of this part or any rule or regulation of the board prescribed and adopted under this part.
7506. Revocation because of nonuse. The board may revoke any supplier's license held by a person who does not engage in, or who discontinues, the removal, entry, or sale of motor vehicle fuel, producing of blended motor vehicle fuel, owning or holding inventory position of motor vehicle fuel, or owning or operating a refinery or terminal as any of the following:
(a) A blender, as defined in Section 7308.
(b) An enterer, as defined in Section 7311.
(c) A position holder, as defined in Section 7332.
(d) A refiner, as defined in Section 7334.
(e) A terminal operator, as defined in Section 7340.
(f) A throughputter, as defined in Section 7341.
7507. Notice of revocation. Before revoking any license the board shall notify the licensee to show cause within 10 days after the notice is given, why his or her license should not be revoked. The notice shall be given in the manner prescribed in Section 7671 for giving notice of a deficiency determination.
7508. Cancellation or revocation of licenses; hearings. The board may cancel any license issued under this part immediately upon surrender thereof but before revoking a license the board shall allow the person an opportunity to show cause as provided in Section 7507.
7509. Tax liability upon revocation. Upon revocation or cancellation of the license of the person or upon his or her cessation of business, all motor vehicle fuel remaining in his or her possession or ownership shall be deemed removed, entered, sold, delivered, or used and subject to jeopardy determination as provided in Section 7698 if, in the judgment of the board, it is necessary to ensure payment of the tax with respect to the removal, entry, sale, delivery, or use of the motor vehicle fuel.
7510. Reinstatement. Subsequent to the revocation of the license of a person, the board shall reinstate the permit when the person pays the amount of tax determined, together with interest and penalties, fully complies with this part, and pays a fee of fifty dollars ($50) to the board for reinstatement. The fee shall not be subject to refund except as provided in Section 8126.
7511. Unlawful operation after revocation. It is unlawful for any person to operate in this state after a license has been revoked.
Article 7. Licensing of Locations
7520. Requirement to disclose multiple locations. Every person required to be licensed by the board shall provide the board with the names and addresses of all agents operating in this state, the location of all offices or other places of business in this state, and any other information as the board may require.