Tax differents for off road and on road

[BigD23]

Difference here in Orygun is $0.24 per gallon.

Don

 

[Farmwithjunk]

I buy upwards of 7500 gallons of offroad diesel per year. (business and farm use. 7800 gallons so far this year) My supplier is very forthcoming with regards to his pricing stratagies. Since they're HIS stratagies and not mine, and I'd not appreciate someone telling the world all of my business dealings, I'll not go too far into specifics. But... It's been explained to me that each and every dealer MAY "discount" off road fuel differently than the next guy. Their cost may vary with handling expenses, volume, cost of their storage facilities, volume purchased by individual customers, ect. It is NOT always "taxed fuel price" less state and/or federal tax amount. Long story short, it might cost them more (or less) per gallon to handle off road fuel that it would "on road" fuel. Cost (or savings) passed on to end user.

In MY case, where I'm buying relatively large quantities, my cost per gallon is SLIGHTLY less than "taxed price" less tax amount.

 

[thatguy]

Ok since you hold that position perhaps you can tell me the logc in charging sales tax on off road and not charging it on the on road fuel.

The fuels tax was implemented to help maintain the public roads. SO it only applies to fuels consumed on the highways. Fuels tax is administered by the DMV and is a tax per gallon ($0.175 for diesel and $0.17x for gasoline). Per Code the fuels tax is charged for any fuel used on the highway (gas, diesel, CNG, clear kero used in winter diesel blend, bio diesel blended with dsl, etc).

Even if someone is caught running dyed (untaxed) fuel on the road they are charged a huge penalty AND the fuels tax for their tank capacity since it was consumed on the road - and therefore caused wear and tear on the roadways..

Sales tax is administered by the Dept of Taxation and is a percentage (5%ish) of the sales amount.. Sales tax is collected on any off road fuel (heating oil, kerosene, off road diesel etc) that the DMV and ABD does not tax. Sales tax is the catch-all agency.

This is how VA does it.. Other states may do it differently.. No one likes double taxation, so the government does not charge fuels tax AND sales tax together..

b

 

[thatguy]

LBrown59 - Did that answer your question?

Brian

 

[LBrown59]

LBrown59 - Did that answer your question?

Brian

Yeah thanks it did as far as Va. goes ; but I am not sure how Oh. does it.

 

[Heavyduty]

thatguy-
What's the fine for dyed fuel use in VA? Some states, it can be as much as $10,000. Thanks

 

[LBrown59]

thatguy-
What's the fine for dyed fuel use in VA? Some states, it can be as much as $10,000. Thanks

Nothing in any state if they don't catch you on the road with it.

 

[thatguy]

thatguy-
What's the fine for dyed fuel use in VA? Some states, it can be as much as $10,000. Thanks

Here in VA the fine is $10/gal of tank size OR minimum of $1,000 + the tax.. That is the VA Code penalty and it mirrors the IRS code.. The IRS will then piggy back with the same fine/penalty..

I have been told that the $10,000 fine is an EPA fine for running higher sulfur content than legally allowed.. Although they do not enforce it from what I have heard.. Someone could do a desk audit of the IRS/State assessments and easily pay there salary..

IMHO - its not worth the price to run dyed fuel.. BUT other ppl think different.. Most states do have a division/department that runs dyed fuel inspections that stop truck on the road and 'dip' the tanks to check for the dyed fuel.. Yrs ago the IRS was basically reimbursing the states the cost of testing for this.. A few yrs ago (before a reorganization) the DMV had its own LEO staff that pretty much did nothing but dyed fuel inspections.

Hope this helps

Brian

 

[thatguy]

Nothing in any state if they don't catch you on the road with it.

That is such a true statement.. But you never know when or where they may be testing for dyed fuel

For me its not worth the risk.. A buddy of my dads needed diesel fuel for his pickup years ago and took it out of a home heating oil tank he had at his shop.. He went out to eat and got checked - $1k to the state, $1k to the feds - that was an expensive fill up..
Brian

 

[MikePA]

For me its not worth the risk..

I agree. For anyone to recommend doing this is incredibly poor advice.