2. Method of calculation; inflation index defined; maximum. The inflation index for 2003 is 1.118, representing annual inflation adjustments for the years 1999 to 2002, inclusive. Starting in 2004 and every year thereafter, the inflation index is the Consumer Price Index as defined in section 5402, subsection 1 for the calendar year ending on the December 31st immediately preceding the calculation date, divided by the Consumer Price Index for the prior calendar year, except that the maximum annual inflation index is 2%.

SUMMARY

This bill suspends the tax imposed on internal combustion engine fuel and on special fuels if the retail price of those fuels exceeds by 50% or more the weekly average retail price of the fuel for the previous 52 weeks or calendar year. This bill also caps the inflation index on motor fuels at 2% annually.