XT 2000-03 - Motor Fuel Tax Information Release - House Bill
612 Information For All Licensed Motor Fuel Dealers -
September 8, 2000
The 123rd General Assembly enacted House Bill 612.
This legislation will be effective September 29, 2000. The
following changes are effective starting with the October
2000 motor fuel tax returns and schedules.
Prior to House Bill 612 transmix was defined as gasoline. It
is our understanding that transmix is regularly mixed with
diesel fuel. Section 5735.01 (D) will now define transmix as
diesel fuel when it is mixed with diesel fuel and Section
5735.01 (E) (3) will now define transmix as gasoline when it
is mixed with gasoline. In essence, transmix takes on the
identity of the product in which it is blended (diesel fuel
or gasoline). This change eliminates many problems in the
proper reporting of transmix.
Prior to this legislation, ethanol was taxed at the same
point as diesel fuel, i.e. when it was used or sold for use
as a motor fuel. This legislation changed Section 5735.01 (E)
(2) to include ethanol in the definition of gasoline. As
such, ethanol will be reported and tax paid the same as
gasoline under Section 5735.01 (J). You have been required to
report ethanol and gasoline separately when filing your
monthly motor fuel tax return. This was necessary because of
the qualified fuel credit on ethanol mixed with gasoline. The
qualified fuel credit, however, expired on June 30, 1997.
With this change, it will no longer be necessary for you to
report and inventory ethanol separately. Effective October 1,
2000, any gasoline/ethanol blend that you buy or sell should
be reported only as gasoline, product code 65. For example,
if you sell a gasoline/ethanol blend of 7,000 gallons of
gasoline and 700 gallons of ethanol (7,700 total) to another
dealer, instead of reporting each product separately you must
report a sale of 7,700 gallons of gasoline.
If you maintain an inventory of ethanol in bulk storage
outside of a terminal, it will be necessary for you to do the
- Make a book adjustment (BA) disbursement of ethanol
(product code 241) in inventory at the close of business on
September 30, 2000 and a corresponding book adjustment
receipt of those same gallons as gasoline (product 65).
- You will no longer file an ethanol recap (MF-2E) starting
with the October 2000 return.
Clear diesel fuel sold in bulk lot loads for use in certain
vessels will be exempt from the motor fuel tax. Section
5735.05 (A) (10) has been enacted to allow a "…sale to a
consumer of diesel fuel, by a motor fuel dealer for delivery
from a bulk lot vehicle, for consumption in operating a
vessel when the use of such fuel in a vessel would otherwise
qualify for a refund under Section 5735.14 of the Revised
Code…". The sale must be made directly by a motor fuel dealer
to the user of the fuel in order to qualify for this
exemption. These sales should be supported by a signed
statement from the purchaser stating that the fuel will be
used only in a vessel and that such use qualifies for
exemption under section 5735.14. Retain the statements for
four years from when your tax return was filed or should have
been filed. Report the sales on schedule 10 of your monthly
disbursement schedule. This exemption does not
pertain to gasoline.
The following changes are effective September 29, 2000.
The term "water clear" has been removed from the definition
of motor fuel and kerosene in sections 5735.01 (B) and (C),
5735.023 (A) and 5735.05(A)(2). Both "waterclear" and "dyed"
K-1 kerosene may be sold tax free at retail service stations
(provided the kerosene isn’t pumped into a motor vehicle fuel
tank). This change does not affect the
requirement that dyed diesel fuel is prohibited from being
sold at retail service stations.
The time for filing motor fuel shrinkage refund claims is
increased from 60 days to 120 days after June 30 and December
31 of each year. The time for filing other motor fuel refund
claims (off road usage or used outside Ohio, mass transit and
sales by non-dealers outside this state or to the U.S.
government) has been increased from 180 days to 365 days.
We are in the process of reprinting the motor fuel tax law
booklet. The revised booklet will contain all the changes
mentioned above and will be sent to you in the near future.
If you have any questions about this release, please contact
the Motor Fuel Tax Compliance Unit at (614) 466-3503.