House Bill No. 326 proposes amendments to the Texas Tax Code to allow for annual adjustments to gasoline and diesel fuel tax rates based on a newly defined "highway cost index." This index will reflect the 12-month moving average of the price of materials and labor as compiled by the Texas Department of Transportation. Specifically, the bill introduces Section 162.1021 for gasoline and Section 162.2021 for diesel fuel, which stipulate that on January 1 of each year, the tax rates will be adjusted by a percentage equal to the change in the highway cost index from the previous fiscal year. The comptroller is tasked with calculating and publishing the new tax rates by December 1 each year, with the first adjusted rates taking effect on January 1, 2026.

Additionally, the bill amends existing sections of the Tax Code to incorporate these new provisions, including backup tax provisions that apply to individuals who misuse tax-exempt fuel. The bill also updates the Transportation Code to align the fee imposed with the new tax rates. The overall aim of the legislation is to ensure that fuel tax rates remain responsive to the costs associated with highway projects, thereby supporting infrastructure funding in Texas. The act is set to take effect on September 1, 2025, with the initial tax rate adjustments commencing in 2026.

Statutes affected:
Introduced: Tax Code 162.103, Tax Code 162.203, Transportation Code 20.002 (Transportation Code 20, Tax Code 162)