Taxable diesel cheaper than non-tax?

[Ken45101]

I didn't think about the fact that they may have "expensive" fuel in the tank. But you think you would let your price of fuel roll with the market. You know if they purchase cheap fuel and the market goes up they raise it right along with it.

I really don't know how the local station raises and lowers their off road price. But I doubt that they worry about competition, it's not like a lower price is posted a half mile down the road. If I'm going to the closest station (5 miles), I'm not going to look at their price and drive another 10 or 20 miles to see if that station is a dime cheaper (or maybe not). I really doubt that competition enters into off road pricing. I could be wrong....

Not the same situation, but I "pre-buy" my home heating oil, which is dyed diesel, or so they tell me. We negotiate a price for however much I think I will need, and I give them the money in the fall. Sometimes, they win, but I believe more often than not I win, as my price throughout the winter is usually lower than the cash price. Last winter, it was $3.49 gal. I usually have them give me about 10 gal. in my yellow diesel containers. Where I live, there isn't much competition for diesel fuel, period. Suburbia- trucks are just passing through, and don't stop for fuel. Farming is pretty much gone or greatly reduced.

It is possible that your dealer uses your money to pre-buy a set contract price, hedging his costs with your deposit.

Ken

 

[Texan4Life]

We just buy on road fuel and save the receipts. And then you can claim it for farm use and get sales and road tax back.

 

[Bluegill2]

Off road here is $3.49, on road is $3.89. Local country store and good folks!

 

[rsewill]

In my state retailers must sell for 10 cents or more than their cost. The fines are in the thousands if they don't. I don't know how it works when they have a transport drop into a tank half full.

 

[pacerron]

Road tax in Ohio for diesel is currently 28 cents. It varies greatly from state to state, as most taxes do. You can find your state rate easily on the internet.
Having it delivered has certain requirements too. Most vendors require a certain minimum gallonage or you will pay a sir tax.The delivered price is not always equal to the daily retail price minus the road tax for reasons stated before in this thread.
The convenience of making a phone call to get it, cost of hauling it yourself, and non productive time wasted are the important factors.
Also, what if you are in an accident while hauling 200 gallon or 4 barrels of fuel or even less. Will your insurance automatically pay for the expensive environmental clean up and fines that may be levied?

To answer the posters question, he did not get screwed. Buying fuel that way is fine but look at the prices first and buy the diesel that is cheaper at the time. It's all the same except for the dye.

 

[Duffster]

In my state retailers must sell for 10 cents or more than their cost. The fines are in the thousands if they don't. I don't know how it works when they have a transport drop into a tank half full.

WI has minimum markup laws too but are seldom obeyed.