2017 Motor Fuel Excise Tax Rates
January 18, 2017 by PMAA | 
What’s New? The biodiesel blender credit, the alternative fuel mixture credit, the sale of use of alternative fuel credit and the alternative fuel infrastructure tax credit all expired on December 31, 2016. The IRS will not accept claims for any renewable fuel blends created after this date. However, timely filed claims for blends created before December 31, 2016 may still be filed.
Also, the federal Oil Spill Liability Tax (OSLT) increased from 8 cents per barrel of crude to 9 cents per barrel of crude on January 1, 2017. The OSLT is paid by refiners and is not treated as a tax below the terminal rack. Instead, the OSLT is passed down by refiners as a cost of the finished product even though many terminal operators break it out on bill of ladings as a “tax”. Therefore, tax exempt parties below the terminal rack are not exempt from the OSLT because it is a cost and not a tax at their point of purchase on the distribution stream.
The following is a list of federal motor fuel excise tax rates for 2017. (LUST tax included where applicable)
|
Product |
Rate* |
Cents Per/Gal |
|
Gasoline |
$.184 |
18.4 cpg |
|
Gasoline (removed for gasohol blending) |
$.184 |
18.4 cpg |
|
Alcohol (for use in downstream gasohol blending) |
$.184 |
18.4 cpg |
|
Aviation Gasoline |
$.194 |
19.4 cpg |
|
Alcohol blends are always taxed at the full federal rate for gasoline. |
|
|
|
Alcohol Blender’s Credit |
(Expired) |
|
|
Biodiesel Blender’s Credit |
(Expired) |
|
|
Alternative Fuel Mixture Credit |
(Expired) |
|
|
Sale or Use of Alternative Fuel Credit |
(Expired) |
|
|
Heating Oil (LUST tax) |
$.001 |
1/10th cpg |
|
Diesel (clear) |
$.244 |
24.4 cpg |
|
Diesel (dyed) |
$.001 |
1/10th cpg |
|
Diesel (dyed, used in trains) |
$.001 |
1/10th cpg |
|
Diesel (removed for blending with biodiesel) |
$.244 |
24.4 cpg |
|
Diesel (used in certain intercity and local buses |
$.17 |
17 |
|
Biodiesel (removed for blending with diesel) |
$.244 |
24.4 cpg |
|
Kerosene (clear) |
$.244 |
24. 4cpg |
|
Kerosene (dyed) |
$.001 |
1/10th cpg |
|
Kerosene (clear - non-commercial aviation)** |
$.219 |
21.9 cpg |
|
Kerosene (clear - for use in non-taxable aviation) |
$.001 |
1/10th cpg |
|
Kerosene (clear - for use in commercial aviation not foreign trade) |
$.044 |
4.4 cpg |
|
Propane (liquefied propane gas) (gasoline gallon equivalent) |
$.183 |
18.3 cpg |
|
Compressed Natural Gas (CNG) (gasolinegallonequivalent) |
$.183 |
18.3 cpg |
|
Liquefied Natural Gas (diesle fuel gallon equivalent) |
$.243 |
24.3 cpg |
|
“P” Series Fuels |
$.184 |
18.4 cpg |
|
Liquefied Fuel (derived from biomass) |
$.244 |
24.4 cpg |
* Rates include the $.001 cpg federal Leaking Underground Storage Tank (LUST) tax. The LUST tax is non-refundable.
** Marketers pay $.244 cpg at the rack, user’s rate is $.219. Ultimate vendor claim is $.025 cpg. The ultimate vendor is the only party that can make the claim for 2.5 cpg. Ultimate vendor must have a certificate from the ultimate purchaser verifying the fuel is used for non-commercial aviation. Ultimate vendor must have an IRS 637 UA registration to file claim.
*** For taxation purposes, one gasoline gallon equivalent (GGE) is equal to 5.75 pounds (lbs.) of propane and 5.66 lbs. of CNG. One diesel gallon equivalent (DGE) is equal to 6.06 lbs. of LNG.
