2025 · Regular session · Senate bill
SB771
SB771 allows a Texas diesel-fuel tax credit or refund for tax-paid fuel used in this state by auxiliary power units or power take-off equipment on motor vehicles.
Official caption: Relating to a credit or refund for diesel fuel taxes paid on diesel fuel used in this state by auxiliary power units or power take-off equipment.
Official report lists Senate author(s): Hinojosa, Juan "Chuy". This does not identify sponsors or amendment drafters.
Bill explanation published · Version and amendment review scope is stated below · Individual amendment records may not be separately annotated.
Bill highlights
Selected points from the published explanation. Follow each point to its source-linked context; conditions and limits may matter.
- SB771 allows a Texas diesel-fuel tax credit or refund for tax-paid fuel used in this state by auxiliary power units or power take-off equipment on motor vehicles.
- The comptroller may approve a meter or another measuring method that accurately separates this fuel use from propulsion fuel while the vehicle is stationary.
- Two exclusions matter: no credit or refund for fuel used for idling, or for climate-control air conditioning or heating primarily for the convenience or comfort of the operator or passengers.
What does it do?
SB771 allows a Texas diesel-fuel tax credit or refund for tax-paid fuel used in this state by auxiliary power units or power take-off equipment on motor vehicles. A fuel-tax license holder may take a credit on the return for the purchase period; someone without that license may claim a refund from the comptroller. This refers to a comptroller-issued fuel-tax license, not an ordinary driver’s license. The bill became law without the governor’s signature May 24, 2025 and took effect September 1, 2025. New Tax Code 162.227(d-1); License-holder definition; History.
The comptroller may approve a meter or another measuring method that accurately separates this fuel use from propulsion fuel while the vehicle is stationary. If there is no separate meter or other approved measuring method, the credit or refund can use a percentage of each equipped vehicle’s diesel consumption, with the percentage determined by the comptroller. The bill does not set one universal percentage or make all fuel used by an equipped truck refundable. Measurement and percentage methods.
Two exclusions matter: no credit or refund for fuel used for idling, or for climate-control air conditioning or heating primarily for the convenience or comfort of the operator or passengers. The latter is not treated as a power take-off system. The general 20-cents-per-gallon diesel tax rate is unchanged; this is targeted relief for qualifying use. Existing authority for comptroller claim procedures remains. Express exclusions; Tax rate; Existing claim framework.
What changed along the way?
The introduced, Senate committee, engrossed, House committee and enrolled operative texts match. Both committees reported without amendments, and the amendment index lists none. The act adds the new subsection to the existing credit/refund law; it does not replace all other motor-fuel exemptions or refund rules. Introduced; All versions; Amendment index; Final addition.
For the full amendment record, open the official amendment index.
Official bill versions
Compare the published text versions in the official text index. A change is not attributed to a specific amendment here without a verified record.
Who could benefit—and who could bear the costs?
Operators with qualifying auxiliary-equipment fuel use can reduce their state diesel-tax cost, while the state collects less revenue. An individual claim depends on eligible fuel use and the approved measurement or percentage method; the act does not promise a particular refund for every operator. Eligibility and limits.
The April 21 fiscal note estimates a $5.230 million loss to general-revenue-related funds in fiscal 2026–2027. That headline excludes the State Highway Fund loss. Adding all three listed funds gives an estimated $19.607 million two-year revenue loss: $438,000 in General Revenue, $4.792 million in the Available School Fund and $14.377 million in the State Highway Fund. These are forecasts, not actual collections or a new spending appropriation. Fiscal note and fund-by-fund table.
The note expects no local-government fiscal impact. Its method allocates estimated losses using the statutory diesel-tax distribution and adjusts fiscal 2026 for the lag in tax remittances; it does not estimate business-by-business savings. Methodology and local impact.
Official sources
- Bill history and latest recorded action
- Bill versions, analyses and fiscal notes
- Action history and votes
- Amendment index
Catalog report retrieved 2026-10-25. Check the official record for corrections or later changes.
