Revised September 28, 2006

Utah Fuel Taxes – General Information

Utah Fuel Tax Rates

  • Motor fuel and special fuel tax is 24.5 cents per gallon
  • Aviation fuel tax is 9 cents per gallon
  • Aviation fuel used by federally-certificated air carriers is taxed at 4 cents per gallon

Definitions

  • Aviation fuel is fuel used exclusively for the operation of aircraft
  • Motor fuel is gasoline or gasohol used for any purpose other than the operation of aircraft
  • Special fuel is any fuel used to operate a motor vehicle upon the public highways of this state and is not taxed under the category of motor or aviation fuel, such as clean special fuels, diesel, propane, electricity and compressed natural gas
  • A qualified motor vehicle is defined as one using special fuel that:
    • has two axles and a gross vehicle weight or registered gross vehicle weight exceeding 26,000 pounds;
    • has three or more axles regardless of weight; or
    • is used in a combination of vehicles when the weight of the combination of vehicles exceeds 26,000 pounds gross vehicle weight.
    This definition does not include recreational vehicles unless the recreational vehicles are used in business activities.

Licenses & Permits

IFTA Licenses

IFTA licenses apply to qualified motor vehicles traveling in more than one jurisdiction. IFTA decals are $4.00 per set.

IFTA licenses may be revoked when a taxpayer fails to file a return, files a return without remitting payment, or does not comply with IFTA record keeping requirements. To reinstate an IFTA license:

  • All missing returns must be filed.
  • Any tax, penalty, and interest due must be paid.
  • A $100 reinstatement fee is also required. The Tax Commission may require the fee to be paid in certified funds or cash.
  • The Tax Commission may also require a bond to be posted to ensure future compliance.

Special Fuel User Permits

Special Fuel User permits apply to qualified motor vehicles traveling within the borders of Utah or based in a non-IFTA state. If a carrier has a bulk special fuel storage tank and has non-IFTA qualified vehicles (see Definitions, above), the carrier must have a special fuel user permit. There is no cost for Special Fuel User permits or decals.

Temporary Permits vs. Utah Special Fuel Trip Permit

Only IFTA issues temporary permits and it is highly unlikely that an operator would need one. Utah issues a Utah Special Fuel trip permit for $25.00. The permit is valid for 96 hours or until you leave the state, whichever happens first.

Grace Period

All carriers with qualified motor vehicles (with existing permits) have been allowed a two-month grace period (or until February 28) to possess the current year Special Fuel User permit or IFTA license and decals.

Fuel Tax Returns

Due to legislative changes that went into effect January 2003, quarterly returns are no longer required for Special Fuel Users who certify on an annual basis that they pay tax on all fuel at the time of purchase and comply with record keeping requirements. Special Fuel Users are still required to have a Special Fuel User permit and renew annually on a calendar year basis. At the time of renewal, they will be asked to certify on Form TC-938, Special Fuel User Renewal Application and Decal Request, that fuel tax has been paid on all fuel and that they will comply with record keeping requirements.

Penalty & Interest for Late Returns

The penalties and interest for filing a later return are as follows:

  • The late filing or late payment penalty is 10% or $50, whichever is greater.
  • Interest is 12% (1% per month) on any balance due for each jurisdiction.

Exempt Fuel

Special Fuel Users who pay fuel tax at the time of purchase and then use the fuel for a purpose exempt from fuel tax must file Form TC-942 to claim a refund.

IFTA has a three year statute of limitations on refunds.

If you don't file a Utah IFTA return and need to claim an exemption for fuel tax on gallons used off-highway, use one of the following returns:

  • Non-Utah IFTA carriers use form TC-922C.
  • Utah Special Fuel User permit holders use form TC-942.

Sales of Fuel to Government Entities

A government entity is defined as the United States, this state, a political subdivision of this state, or an Indian tribe acting in its tribal capacity, not Indian businesses, see Administrative Rule R865-13G-10.

Motor fuel and special fuel are handled differently.

Motor Fuel

Licensed distributor may sell fuel tax exempt to government entities if no fuel tax has been assessed. A licensed distributor will put the exempt government gallons sold on their motor fuel return (TC-109) line 9. Line 9 requires an attachment of schedule TC-110G and copies of invoices.

If the motor fuel sold to the government entity has the fuel tax assessed the government entity may file a refund request with the Tax Commission by completing form TC-114M.

Special Fuel

Special fuel tax is due on undyed diesel fuel and untaxed special fuel blended with undyed diesel fuel when first removed from the refinery or entering the state. Once the special fuel tax has been assessed only the government entity may request a refund by completing form TC-114S.

Note: If the state government entity or political subdivision participates in the State Fuel Network, with a Gascard issued by the Fleet Services, the motor fuel or special fuel refund must be requested through Fleet Services not the Tax Commission, even if the purchase is outside the State Fuel Network.

Environmental Assurance Fee

An Environmental Assurance fee is assessed on the first sale of a petroleum product. Beginning July 1, 2003, the rate is .005.

Retailers or consumers who are owners or operators of stationary storage tanks not participating in the Department Environmental Quality's underground tanks program are exempt from this fee if the following conditions are met:

  • none of the owner's or operator's tanks are covered under the Environmental Assurance Program; and
  • the fuel purchased has not had the environmental assurance fee previously imposed.

The owners or operators who do not meet both of the above conditions to purchase the fuel exempt from the environmental assurance fee, may qualify for a refund from the Tax Commission for the fees paid. See form TC-113.

Bio-diesel

Bio-diesel is treated the same as diesel as far as fuel taxes are concerned.

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